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Finance Act 2001

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This is the original version (as it was originally enacted).

Finance Act 2001

2001 CHAPTER 9

An Act to grant certain duties, to alter other duties, and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with Finance.

[11th May 2001]

Most Gracious Sovereign,

We, Your Majesty’s most dutiful and loyal subjects, the Commons of the United Kingdom in Parliament assembled, towards raising the necessary supplies to defray Your Majesty’s public expenses, and making an addition to the public revenue, have freely and voluntarily resolved to give and grant unto Your Majesty the several duties hereinafter mentioned; and do therefore most humbly beseech Your Majesty that it may be enacted, and be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Part 1Excise duties

Hydrocarbon oil duties

1Rates of duty on hydrocarbon oil

(1)In section 6(1A) of the Hydrocarbon Oil Duties Act 1979 (c. 5) (rates of duty on hydrocarbon oil)—

(a)in paragraph (a) (ultra-low sulphur petrol), for “£0.4782” substitute “£0.4582”; and

(b)in paragraph (c) (ultra-low sulphur diesel), for “£0.4882” substitute “£0.4582”.

(2)That subsection shall have effect until midnight on 14th June 2001 as if for paragraph (b) (other light oil) there were substituted—

(ba)£0.5268 in the case of unleaded petrol other than ultra low sulphur petrol;

(bb)£0.5468 in the case of light oil not within paragraph (a) or (ba) above;.

After that, paragraph (b) shall have effect as it did before.

(3)In section 8(3) of the Hydrocarbon Oil Duties Act 1979 (c. 5) (rate of duty on road fuel gas) for “£0.1500” substitute “£0.0900”.

(4)This section shall be deemed to have come into force at 6 o'clock in the evening of 7th March 2001.

2Rebate on unleaded petrol

(1)For section 13A of the Hydrocarbon Oil Duties Act 1979 (under which different rates of rebate are specified for higher octane and other unleaded petrol) substitute—

13ARebate on unleaded petrol

(1)On unleaded petrol, other than ultra low sulphur petrol, charged with the excise duty on hydrocarbon oil and delivered for home use there shall be allowed at the time of delivery a rebate of duty at the rate of £0.0586 a litre.

(2)Rebate is not allowed under this section in a case where a rebate is allowed under section 14 below..

(2)In paragraph 1(1) of Schedule 2A to that Act (converting unleaded petrol into leaded petrol)—

(a)for paragraphs (a) and (b) substitute—

(ab)adding lead to unleaded petrol in respect of which a rebate has been allowed under section 13A;; and

(b)in paragraph (c)—

(i)for “paragraph (a)” substitute “paragraph (aa)”, and

(ii)for “paragraph (b)” substitute “paragraph (ab)”.

(3)For paragraph 2A of that Schedule (mixing different kinds of unleaded petrol) substitute—

2A(1)A mixture which is unleaded petrol is produced in contravention of this paragraph if the mixture is produced by mixing—

(a)petrol on which duty has been paid at the rate specified in section 6(1A)(a), and

(b)petrol in respect of which a rebate has been allowed under section 13A,

and the mixture produced is unleaded petrol that is not ultra low sulphur petrol.

(2)This paragraph is subject to any direction given under paragraph 3..

(4)In paragraph 8 of that Schedule (rate of duty on mixtures of light oil), for sub-paragraph (3A) substitute—

(3A)In the case of a mixture produced in contravention of paragraph 2A above, the rate is that produced by deducting from the rate in force under section 6(1A)(b) at the time the mixture is produced the rebate which at that time is in force under section 13A..

(5)This section shall be deemed to have come into force at 6 o'clock in the evening of 7th March 2001.

3Fuel-testing pilot projects

(1)In the Hydrocarbon Oil Duties Act 1979 (c. 5), after section 20AA insert—

20ABPower to allow reliefs for fuel testing etc

(1)The Commissioners may by regulations make provision allowing reliefs as regards excise duty charged in respect of experimental fuel where—

(a)the fuel is, or is to be, used for the purposes of a fuel-testing project that is approved by the Commissioners,

(b)the project is approved for the purposes of the development of the fuel (see subsection (8)(a) below), and

(c)the use takes place, or is to take place, during the period that, for the purposes of the project, is the relief period for the fuel (see subsection (8)(b) below).

(2)In this section “experimental fuel” means a substance of a description specified in regulations made by the Commissioners.

(3)For each experimental fuel, the Commissioners shall by regulations make provision specifying—

(a)the beginning and end of the period that is the experimental period for that fuel; and

(b)the form that (subject to any directions under subsection (9)(a) below) is to be taken by relief under this section as regards excise duty chargeable on that fuel.

(4)A form of relief specified under subsection (3)(b) above must be an authorised form; and for the purposes of this section “an authorised form” is—

(a)a repayment, or

(b)a rebate (or extra rebate).

(5)Relief under this section shall be allowed—

(a)to the extent specified in, or determined in accordance with, regulations under subsection (1) above, and

(b)subject to—

(i)such conditions as the Commissioners may impose, and

(ii)any directions under subsection (9)(b) below.

(6)The conditions that may be imposed under subsection (5)(b)(i) above include, in particular, conditions in connection with—

(a)the collection, keeping, compilation or analysis, or

(b)the supply to the Commissioners or other persons,

of data, or information, relating to the production, use or performance of an experimental fuel.

(7)Subsections (8) and (9) below apply where the Commissioners have approved a fuel-testing project.

(8)The Commissioners shall give directions specifying—

(a)each experimental fuel for the purposes of whose development the project is approved;

(b)for each fuel specified under paragraph (a) above, the beginning and end of the period that, for the purposes of the project, is (in accordance with subsection (10) below) the relief period for the fuel; and

(c)any conditions imposed under subsection (5)(b)(i) above that apply to the allowance under this section of relief as regards excise duty chargeable in respect of an experimental fuel used, or to be used, for the purposes of the project.

(9)The Commissioners may give directions—

(a)providing for relief as regards excise duty chargeable in respect of an experimental fuel used, or to be used, for the purposes of the project to take an authorised form different to the form specified under subsection (3)(b) above;

(b)as to administration in connection with allowing reliefs under this section as regards excise duty chargeable in respect of an experimental fuel used, or to be used, for the purposes of the project.

(10)For the purposes of subsection (8)(b) above—

(a)the beginning of the relief period for a fuel may not be earlier than the beginning of the experimental period for that fuel; and

(b)the end of the relief period for a fuel may not be later than the end of the experimental period for that fuel.

(11)In this section—

  • “excise duty” means—

    (a)

    excise duty chargeable by virtue of this Act, or

    (b)

    any addition to such duty by virtue of section 1 of the Excise Duties (Surcharges or Rebates) Act 1979 (c. 8);

  • “fuel-testing project” means a pilot project connected with the technological development of environment-friendly fuels.

(12)Regulations under this section may make different provision for different cases..

(2)In section 24(1) of the Hydrocarbon Oil Duties Act 1979 (c. 5) (regulations for the purposes of provisions providing for rebates etc.), after “section 19A” insert “, section 20AB”.

(3)In section 27(1) of the Hydrocarbon Oil Duties Act 1979 (interpretation), in the definition of “rebate”, for “or 14” substitute “, 14 or 20AB”.

(4)In section 12B(1)(h) of the Finance Act 1994 (c. 9) (excise duty reliefs that may be recovered under section 12A when wrongly given), after “allowed to a person by virtue of section 20AA” insert “or 20AB”.

Tobacco products duty

4Rates of tobacco products duty

(1)For the Table of rates of duty in Schedule 1 to the Tobacco Products Duty Act 1979 (c. 7) substitute—

TABLE
1. CigarettesAn amount equal to 22 per cent. of the retail price plus 92.25 per thousand cigarettes.
2. Cigars134.69 per kilogram.
3. Hand-rolling tobacco96.81 per kilogram.
4. Other smoking tobacco and chewing tobacco59.21 per kilogram.

(2)This section shall be deemed to have come into force at 6 o'clock in the evening of 7th March 2001.

Alcoholic liquor duties

5Dilution etc. of cider

In section 62(5) of the Alcoholic Liquor Duties Act 1979 (c. 4) (regulations providing for the management of the duty on cider), after paragraph (d) insert—

(e)regulating and, in such circumstances as may be prescribed in the regulations, prohibiting the addition of substances to, the mixing of, or the carrying out of other operations on or in relation to, cider..

Betting and gaming duties

6General betting duty

(1)Schedule 1 to this Act (which makes provision about general betting duty) has effect.

(2)This section shall come into force in accordance with such provision as the Commissioners of Customs and Excise may make by order made by statutory instrument.

7Rates of gaming duty

(1)For the table in section 11(2) of the Finance Act 1997 (c. 16) (rates of gaming duty) substitute—

TABLE
Part of gross gaming yieldRate
The first £484,5002.5 per cent.
The next £1,076,00012.5 per cent.
The next £1,076,00020 per cent.
The next £1,883,50030 per cent.
The remainder40 per cent.

(2)This section has effect in relation to accounting periods beginning on or after 1st April 2001.

Vehicle excise duty

8Threshold for reduced general rate

(1)In paragraph 1 of Schedule 1 to the Vehicle Excise and Registration Act 1994 (c. 22) (rate of duty applicable where no other rate specified), in sub-paragraphs (2) and (2A) for “1,200 cubic centimetres” (the reduced rate threshold) substitute “1,549 cubic centimetres”.

This amendment applies to licences issued on or after 1st July 2001.

(2)Refunds shall be made by the Secretary of State, in accordance with the following provisions of this section, in respect of licences—

(a)issued in the period beginning with 1st November 2000 and ending with 30th June 2001, and

(b)not surrendered before the end of that period,

where the amount of vehicle excise duty chargeable on the licence would have been less if the amendment in subsection (1) had applied.

(3)The amount of the refund is—

(a)£55 for a 12 month licence, and

(b)£27.50 for a 6 month licence.

(4)The person entitled to the refund is—

(a)in the case of a licence in force on 30th June 2001, the keeper of the vehicle on that date;

(b)in the case of a licence that has ceased to be in force before that date, the keeper of the vehicle when the licence expired.

(5)For the purposes of subsection (4) the keeper of the vehicle shall be taken to be—

(a)the person registered as keeper of the vehicle on the date in question, or

(b)if the Secretary of State has received notification of a change of ownership of the vehicle as a result of which another person is on that date entitled to be registered as the new keeper of the vehicle, that person.

(6)A refund shall only be made if an application is made for it in such form, and containing such particulars and supported by such documents, as the Secretary of State may require.

(7)The Secretary of State shall give notice in writing to any person appearing to him to be entitled to a refund—

(a)informing him that he appears to be entitled to a refund,

(b)enclosing an application form, and

(c)specifying the particulars and supporting documents to be provided.

(8)An application for, or the making of, a refund under this section in respect of a licence does not affect the validity of the licence.

(9)For the purposes of section 19 of the Vehicle Excise and Registration Act 1994 (c. 22) (surrender of licences) as it applies to the surrender on or after 1st July 2001 of a licence in respect of which a refund under this section has been made, or applied for, the annual rate of duty chargeable on the licence shall be taken to be that which would have been chargeable if the amendment in subsection (1) above had applied.

(10)Section 45 of that Act (offence of false or misleading declaration) applies to a declaration in connection with an application for a refund under this section as it applies to a declaration in connection with an application for a vehicle licence.

(11)In the application of this section to Northern Ireland, references to registration as the keeper of a vehicle shall be read as references to registration as the owner of the vehicle.

(12)This section shall come into force on 1st July 2001.

9Rates of duty for goods vehicles

(1)Schedule 2 to this Act (which makes provision for new rates of vehicle excise duty for goods vehicles etc.) has effect.

(2)The provisions of that Schedule apply in relation to licences issued on or after 1st December 2001.

10Rates of duty for vehicles used for exceptional loads

(1)Part 6 of Schedule 1 to the Vehicle Excise and Registration Act 1994 (annual rates of vehicle excise duty: vehicles used for exceptional loads) is amended as follows.

(2)In paragraph 6(2A)(a) (vehicles not satisfying reduced pollution requirements), for “£5,170” substitute “£2,585”.

(3)In paragraph 6(2A)(b) (vehicles satisfying reduced pollution requirements), for “£4,170” substitute “£2,085”.

(4)The provisions of this section apply in relation to licences issued on or after 1st December 2001.

11Rates of duty for recovery vehicles

(1)In Part 5 of Schedule 1 to the Vehicle Excise and Registration Act 1994 (c. 22) (annual rates of vehicle excise duty: recovery vehicles), paragraph 5(1) is amended as follows.

(2)For paragraphs (a) and (b) substitute—

(a)if it has a revenue weight exceeding 3,500 kilograms and not exceeding 25,000 kilograms, the same as the basic goods vehicle rate;.

(3)In paragraph (c) (vehicle with revenue weight exceeding 25,000 kilograms charged at 500 per cent of basic goods vehicle rate), for “500” substitute “250”.

(4)The provisions of this section apply in relation to licences issued on or after 1st December 2001.

12Mobile pumping vehicles

(1)Part 4 of Schedule 1 to the Vehicle Excise and Registration Act 1994 (annual rates of duty: special vehicles) is amended as follows.

(2)In paragraph 4(2), after paragraph (d) insert—

(dd)mobile pumping vehicle,.

(3)In paragraph 4, after sub-paragraph (5) insert—

(5A)In sub-paragraph (2)(dd) “mobile pumping vehicle” means a vehicle—

(a)which is constructed or adapted for use and used for the conveyance of a pump and a jib satisfying the requirements specified in sub-paragraph (5B),

(b)which is used on public roads only—

(i)when the vehicle is stationary and the pump is being used to pump material from a point in the immediate vicinity to another such point, or

(ii)for the purpose of proceeding to and from a place where the pump is to be or has been used, and

(c)which, when so proceeding, does not carry—

(i)the material that is to be or has been pumped, or

(ii)any other load except such as is necessary for the propulsion or equipment of the vehicle or for the operation of the pump.

(5B)The requirements are that each of the pump and the jib is—

(a)built in as part of the vehicle, and

(b)designed so that material pumped by the pump is delivered to a desired height or depth through piping that—

(i)is attached to the pump and the jib, and

(ii)is raised or lowered to that height or depth by operation of the jib..

(4)In paragraph 1A (old vehicles) of Schedule 2 to the Vehicle Excise and Registration Act 1994 (exempt vehicles)—

(a)in sub-paragraph (2)(b)(ii) (mobile cranes etc. not exempt vehicles under paragraph 1A), after “mobile crane,” insert “mobile pumping vehicle,”, and

(b)in sub-paragraph (5) (definitions), after ““mobile crane”” insert “, “mobile pumping vehicle””.

(5)The amendments made by subsections (2) to (4) apply to licences issued after the day on which this Act is passed.

(6)Where—

(a)a licence was issued on or before that day for a mobile pumping vehicle (within the meaning given by the paragraph 4(5A) inserted by subsection (3)) on the basis that the vehicle was a mobile crane (within the meaning given by paragraph 4(5) of Schedule 1 to the Vehicle Excise and Registration Act 1994 (c. 22)), and

(b)vehicle excise duty was paid accordingly,

the vehicle shall be deemed to have been a mobile crane at any time on or before that day when the licence was in force (but this does not affect proceedings in any court that were concluded on or before that day).

13Exemption of agricultural etc. vehicles

(1)In Schedule 2 to the Vehicle Excise and Registration Act 1994 (exempt vehicles), after paragraph 20A insert—

Tractors

20B(1)A vehicle is an exempt vehicle if it is—

(a)an agricultural tractor, or

(b)an off-road tractor.

(2)In sub-paragraph (1) “agricultural tractor” means a tractor used on public roads solely for purposes relating to agriculture, horticulture, forestry or activities falling within sub-paragraph (3).

(3)The activities falling within this sub-paragraph are—

(a)cutting verges bordering public roads;

(b)cutting hedges or trees bordering public roads or bordering verges which border public roads.

(4)In sub-paragraph (1) “off-road tractor” means a tractor which is not an agricultural tractor (within the meaning given by sub-paragraph (2)) and which is—

(a)designed and constructed primarily for use otherwise than on roads, and

(b)incapable by reason of its construction of exceeding a speed of twenty-five miles per hour on the level under its own power.

Light agricultural vehicles

20C(1)A vehicle is an exempt vehicle if it is a light agricultural vehicle.

(2)In sub-paragraph (1) “light agricultural vehicle” means a vehicle which—

(a)has a revenue weight not exceeding 1,000 kilograms,

(b)is designed and constructed so as to seat only the driver,

(c)is designed and constructed primarily for use otherwise than on roads, and

(d)is used solely for purposes relating to agriculture, horticulture or forestry.

Agricultural engines

20DAn agricultural engine is an exempt vehicle.

Mowing machines

20EA mowing machine is an exempt vehicle.

Steam powered vehicles

20FA steam powered vehicle is an exempt vehicle.

Electrically propelled vehicles

20GAn electrically propelled vehicle is an exempt vehicle.

Snow ploughs

20HA vehicle is an exempt vehicle when it is—

(a)being used,

(b)going to or from the place where it is to be or has been used, or

(c)being kept for use,

for the purpose of clearing snow from public roads by means of a snow plough or similar device (whether or not forming part of the vehicle).

Gritters

20JA vehicle is an exempt vehicle if it is constructed or adapted, and used, solely for the conveyance of machinery for spreading material on roads to deal with frost, ice or snow (with or without articles or material used for the purposes of the machinery)..

(2)In Part 2 of Schedule 1 to the Vehicle Excise and Registration Act 1994 (c. 22) (annual rates of duty: motorcycles), paragraph 2 is amended as follows—

(a)in sub-paragraph (1)(a) (rate of duty for electrically propelled motorcycles etc.), omit “or the motorcycle is an electrically propelled vehicle”, and

(b)in sub-paragraph (3), in the definition of “motorcycle”, after “motortricycle” insert “but does not include an electrically propelled vehicle”.

(3)Part 4A of Schedule 1 to the Vehicle Excise and Registration Act 1994 (annual rates of duty: special concessionary vehicles) shall cease to have effect.

(4)The amendments made by subsections (1) to (3) and (13) apply to licences issued on or after 1st April 2001.

(5)Subsection (6) applies where a licence—

(a)is issued before 1st April 2001 for a relevant vehicle, and

(b)is in force on 1st April 2001 or comes into force after 1st April 2001.

(6)The licence shall, during the period—

(a)beginning with the later of 1st April 2001 and the day when it comes into force, and

(b)ending with the expiry of the period for which it is issued,

be deemed to be a nil licence for the purposes of the Vehicle Excise and Registration Act 1994 (c. 22).

(7)A refund shall be made by the Secretary of State, in accordance with the following provisions of this section, in respect of a licence for a relevant vehicle that—

(a)is issued before 1st March 2001, in force on 1st March 2001 and not surrendered before 1st April 2001,

(b)is issued before 1st March 2001, comes into force after 1st March 2001 and is not surrendered before 1st April 2001, or

(c)is issued in March 2001 and not surrendered before 1st April 2001.

(8)The amount of the refund is one-twelfth of the annual rate of duty chargeable on the licence for—

(a)in the case of a licence issued before 1st March 2001, each whole month after February 2001 that forms part of the period for which the licence was issued, and

(b)in the case of a licence issued on or after 1st March 2001, each whole month of the period for which the licence is issued.

(9)The person entitled to the refund is the person registered as the keeper of the relevant vehicle on 30th April 2001.

(10)The provisions of sections 10(2) and 19 of the Vehicle Excise and Registration Act 1994 (surrender of licences) do not apply to a licence in respect of which a person is entitled to a refund under this section.

(11)In the application of this section to Northern Ireland, references to registration as the keeper of a vehicle shall be read as references to registration as the owner of the vehicle.

(12)In subsections (5) to (9) “relevant vehicle” means a vehicle of any of the descriptions mentioned in the paragraphs 20B to 20J inserted by subsection (1).

(13)For section 16(1) of the Finance Act 1996 (c. 8) substitute—

(1)Schedule 1 to the Vehicle Excise and Registration Act 1994 (annual rates of duty) is amended as follows..

(14)This section shall be deemed to have come into force on 1st April 2001.

14Surrender of vehicle licences

(1)Section 19 of the Vehicle Excise and Registration Act 1994 (surrender of licences) is amended as follows.

(2)After subsection (1) insert—

(1A)Subsection (1B) applies where the holder of a licence—

(a)has notified the Secretary of State that he wishes to surrender the licence under section 10(2),

(b)has agreed to comply with such conditions as may be specified in relation to him by the Secretary of State, and

(c)if the conditions so specified in relation to him include a condition such as is mentioned in subsection (1C)(a), has complied with that condition.

(1B)If the holder has not surrendered the licence before the time when paragraphs (a) to (c) of subsection (1A) are first all satisfied, then at that time—

(a)the holder becomes entitled to rebate under subsection (1) as if he had surrendered the licence at that time,

(b)the licence ceases to be in force, and

(c)the provisions of section 10(2) and subsection (1) cease to apply to the licence.

(1C)The conditions which may be specified under subsection (1A)(b) include—

(a)a condition that particulars for the time being prescribed under section 22(1D)(a) are furnished by being transmitted to the Secretary of State by such electronic means as he may specify; and

(b)a condition that the licence be returned to the Secretary of State within such period as may be specified by the Secretary of State..

(3)Subsection (3) (no rebate under subsection (1) where regulations not complied with) shall cease to have effect.

General

15Payments by Commissioners in case of error or delay

Schedule 3 to this Act (which allows or requires the Commissioners of Customs and Excise to make payments in cases of error or delay in relation to excise duty) has effect.

Part 2Aggregates Levy

Charging provisions

16Charge to aggregates levy

(1)A levy, to be known as aggregates levy, shall be charged in accordance with this Part on aggregate subjected to commercial exploitation.

(2)The charge to the levy shall arise whenever a quantity of taxable aggregate is subjected, on or after the commencement date, to commercial exploitation in the United Kingdom.

(3)The person charged with the levy arising on any occasion on a quantity of aggregate subjected to commercial exploitation shall be the person responsible for its being so subjected on that occasion.

(4)The levy shall be charged at the rate of £1.60 per tonne of aggregate subjected to commercial exploitation; and the amount of levy charged on a part of a tonne of aggregate shall be the proportionately reduced amount.

(5)The levy shall be under the care and management of the Commissioners of Customs and Excise (in this Part referred to as “the Commissioners”).

(6)In this Part “the commencement date” means such date as the Treasury may by order made by statutory instrument appoint for the purposes of this section.

17Meanings of “aggregate” and “taxable aggregate”

(1)In this Part “aggregate” means (subject to section 18 below) any rock, gravel or sand, together with whatever substances are for the time being incorporated in the rock, gravel or sand or naturally occur mixed with it.

(2)For the purposes of this Part any quantity of aggregate is, in relation to any occasion on which it is subjected to commercial exploitation, a quantity of taxable aggregate except to the extent that—

(a)it is exempt under this section;

(b)it has previously been used for construction purposes (whether before or after the commencement date);

(c)it is, or derives from, any aggregate that has already been subjected to a charge to aggregates levy;

(d)it is aggregate that was removed from its originating site before the commencement date.

(3)For the purposes of this Part aggregate is exempt under this section if—

(a)it is rock that has not been subjected to an industrial crushing process;

(b)it consists wholly of aggregate won by being removed from the ground on the site of any building or proposed building in the course of excavations lawfully carried out—

(i)in connection with the modification or erection of the building; and

(ii)exclusively for the purpose of laying foundations or of laying any pipe or cable;

(c)it consists wholly of aggregate won—

(i)by being removed from the bed of any river, canal or watercourse (whether natural or artificial) or of any channel in or approach to any port or harbour (whether natural or artificial); and

(ii)in the course of the carrying out of any dredging undertaken exclusively for the purpose of creating, restoring, improving or maintaining that river, canal, watercourse, channel or approach;

(d)it consists wholly of aggregate won by being removed from the ground along the line or proposed line of any highway or proposed highway and in the course of excavations carried out—

(i)for the purpose of improving or maintaining the highway or of constructing the proposed highway; and

(ii)otherwise than wholly or mainly for the purpose of extracting that aggregate; or

(e)it consists wholly of the spoil, waste or other by-products resulting from the extraction or other separation from any quantity of aggregate of any china clay or ball clay.

(4)For the purposes of this Part a quantity of any aggregate shall be taken to be a quantity of aggregate that is exempt under this section if it consists wholly or mainly of any one or more of the following, or is part of anything so consisting, namely—

(a)coal, lignite, slate or shale;

(b)the spoil from any process by which coal has been separated from other rock after being extracted or won with that other rock;

(c)the spoil or waste from, or other by-products of—

(i)any industrial combustion process, or

(ii)the smelting or refining of metal;

(d)the drill-cuttings resulting from any operations carried out in accordance with a licence granted under the Petroleum Act 1998 (c. 17) otherwise than in relation to petroleum situated in the strata in Great Britain;

(e)anything resulting from works carried out in exercise of powers which are required to be exercised in accordance with, or are conferred by, provision made by or under the New Roads and Street Works Act 1991 (c. 22), the Roads (Northern Ireland) Order 1993 (S.I. 1993/3160 (N.I. 15)) or the Street Works (Northern Ireland) Order 1995 (S.I. 1995/3210 (N.I. 19));

(f)clay, soil or vegetable or other organic matter.

(5)For the purposes of this section aggregate subjected to exploitation in the United Kingdom is aggregate that has already been subjected to a charge to aggregates levy if, and only if—

(a)there has been a previous occasion on which a charge to aggregates levy on that aggregate has arisen; and

(b)at least some of the aggregates levy previously charged on that aggregate is either—

(i)levy in respect of which there is or was no entitlement to a tax credit; or

(ii)levy in respect of which any entitlement to a tax credit is or was an entitlement to a tax credit of an amount less than the amount of the levy charged on it.

(6)For the purposes of subsection (5)(b) above, any credit the entitlement to which arises in a case which—

(a)falls within section 30(1)(c) below, and

(b)is prescribed for the purposes of this subsection,

shall be disregarded.

(7)In this section—

  • “coal” has the same meaning as in the Coal Industry Act 1994 (c. 21); and

  • “highway” includes any road within the meaning of the Roads (Scotland) Act 1984 (c. 54) or the Road Traffic (Northern Ireland) Order 1995 (S.I. 1995/2994 (N.I. 18)).

18Exempt processes

(1)In this Part references to aggregate—

(a)include references to the spoil, waste, off-cuts and other by-products resulting from the application of any exempt process to any aggregate; but

(b)do not include references to anything else resulting from the application of any such process to any aggregate.

(2)In this Part “exempt process” means—

(a)the cutting of any rock to produce dimension stone;

(b)any process by which a relevant substance is extracted or otherwise separated (whether as part of the process of winning it from any land or otherwise) from any aggregate;

(c)any process for the production of lime or cement from limestone or from limestone and some other substance.

(3)In this section “relevant substance” means any of the following—

(a)anhydrite;

(b)ball clay;

(c)barytes;

(d)calcite;

(e)china clay;

(f)feldspar;

(g)fireclay;

(h)flint;

(i)fluorspar;

(j)fuller’s earth;

(k)gems and semi-precious stones;

(l)gypsum;

(m)any metal or the ore of any metal;

(n)muscovite;

(o)perlite;

(p)potash;

(q)pumice;

(r)rock phosphates;

(s)sodium chloride;

(t)talc;

(u)vermiculite.

(4)The Treasury may by order made by statutory instrument—

(a)modify the list of substances in subsection (3) above by adding any substance to that list or by removing any substance from it; and

(b)make any such transitional provision in connection with the modification of that list under this subsection as they may think fit.

(5)The Treasury shall not make an order under subsection (4) above by virtue of which any substance ceases to be a relevant substance unless a draft of the order has been laid before Parliament and approved by resolution of the House of Commons.

(6)A statutory instrument containing an order under subsection (4) above that has not had to be approved in draft for the purposes of subsection (5) above shall be subject to annulment in pursuance of a resolution of the House of Commons.

19Commercial exploitation

(1)For the purposes of this Part a quantity of aggregate is subjected to exploitation if, and only if—

(a)it is removed from a site falling within subsection (2) below;

(b)it becomes subject to an agreement to supply it to any person;

(c)it is used for construction purposes; or

(d)it is mixed, otherwise than in permitted circumstances, with any material or substance other than water.

(2)The sites which, in relation to any quantity of aggregate, fall within this subsection are—

(a)the originating site of the aggregate;

(b)any site which is not the originating site of the aggregate but is registered under the name of a person who is the operator of that originating site, or is one of its operators;

(c)any site not falling within paragraph (a) or (b) above to which the quantity of aggregate had been removed for the purpose of having an exempt process applied to it on that site but at which no such process has been applied to it.

(3)For the purposes of this Part the exploitation to which a quantity of aggregate is subjected shall be taken to be commercial exploitation if, and only if—

(a)it is subjected to exploitation in the course or furtherance of a business carried on by the person, or one of the persons, responsible for subjecting it to exploitation;

(b)the exploitation to which it is subjected does not consist in its removal from one registered site to another in a case where both sites are registered under the name of the same person;

(c)the exploitation to which it is subjected does not consist in or require its removal to a registered site for the purpose of having an exempt process applied to it on that site;

(d)the exploitation to which it is subjected does not consist in or require its removal to any premises for the purpose of having china clay or ball clay extracted or otherwise separated from it on that site; and

(e)the exploitation to which it is subjected is not such that, as a result and without its being subjected to any process involving its being mixed with any other substance or material (apart from water), it again becomes part of the land at the site from which it was won.

(4)Where, at the time when any aggregate is won from any site, the same person is in occupation of both—

(a)that site, and

(b)adjacent land which is occupied, together with that site—

(i)for the purposes of the carrying on of any agricultural business, or

(ii)for the purposes of the carrying on of any forestry business or otherwise for the purposes of forestry,

subsection (3)(e) above shall have effect as if the reference to the land at the site from which the aggregate was won included the adjacent land, so long as it and that site continue to be occupied by that person for such purposes.

(5)For the purposes of this Part where a quantity of aggregate is subjected to exploitation, the exploitation shall be taken to be in the United Kingdom if, and only if, the aggregate is in the United Kingdom or United Kingdom waters when it is subjected to exploitation.

(6)For the purposes of this section a quantity of aggregate becomes subject to an agreement to supply it to any person—

(a)except to the extent that it is not separately identifiable at the time when the agreement is entered into, at that time; and

(b)to that extent, at the time when it is appropriated to the agreement;

but references in this Part to the supply of a quantity of aggregate do not include references to any supply which is effected, or is to be effected, by the transfer or creation of any interest or right in or over land.

(7)For the purposes of this section a quantity of aggregate is mixed with a material or substance in permitted circumstances if—

(a)the material or substance with which it is mixed consists wholly of a quantity of taxable aggregate that has not previously been subjected to commercial exploitation in the United Kingdom; and

(b)the mixing takes place on a site which, in a case where it falls within subsection (2) above in relation to any part of the aggregate included in the mixture, so falls in relation to every part of it.

20Originating sites

(1)In this Part references, in relation to any aggregate, to its originating site are references (subject to subsection (2) below)—

(a)in the case of aggregate which has been won from the seabed of any area of sea in the United Kingdom or United Kingdom waters and is not rock, to the site where it is first landed after being so won;

(b)in the case of aggregate which results from the application of an exempt process to any aggregate and is not rock, to the site where that process was so applied;

(c)in the case of rock, to the site at which it is first subjected to an industrial crushing process; and

(d)in any other case, to the site from which the aggregate was won or, as the case may be, from which it was most recently won.

(2)Where any aggregate which is on its originating site on the commencement date has been mixed before that date with aggregate the originating site of which would (but for this subsection) be different, the site where the mixture is situated on that date shall be deemed for the purposes of this Part to be the originating site of all the aggregate comprised in the mixture.

21Operators of sites

(1)For the purposes of this Part the persons operating a site are each of the following—

(a)the person who occupies the site; and

(b)if a person other than the occupier exercises any right to exercise control over aggregate on that site, that other person;

and “operator”, in relation to a site, shall be construed accordingly.

(2)In subsection (1) above the reference to exercising control over aggregate on a site is a reference to doing any of the following, that is to say—

(a)winning aggregate from land at that site;

(b)carrying out an industrial crushing process at that site in relation to any rock;

(c)carrying out any exempt process at that site;

(d)storing aggregate at that site.

22Responsibility for exploitation of aggregate

(1)Subject to subsection (2) below, the persons who shall be taken for the purposes of this Part to be responsible for subjecting a quantity of aggregate to exploitation are each of the following—

(a)in a case of the exploitation of a quantity of aggregate by its removal from its originating site or from a connected site, the operator of that site;

(b)in a case of the exploitation of a quantity of aggregate by its removal from a site falling within section 19(2)(c) above, the operator of the site and (if different) the owner of the aggregate at the time when the removal takes place;

(c)in a case of the exploitation of a quantity of aggregate—

(i)by its being subjected, at a time when it is not on its originating site or a connected site, to any agreement, or

(ii)by its being used at such a time for construction purposes,

the person agreeing to supply it or using it for construction purposes;

(d)in a case of the exploitation of a quantity of aggregate—

(i)by its being subjected, at a time when it is on its originating site or a connected site, to any agreement, or

(ii)by its being used at such a time for construction purposes,

the person mentioned in paragraph (c) above and (if different) the operator of that site;

(e)in a case of the exploitation of a quantity of aggregate by its being mixed at premises that are not comprised in its originating site or a connected site with any material or substance, the owner of the aggregate at the time when the mixing takes place and the occupier of the premises where it takes place;

(f)in a case of the exploitation of a quantity of aggregate by its being mixed at its originating site or a connected site with any material or substance, the owner of the aggregate at the time when the mixing takes place and (if different) the operator of the site.

(2)A person who is responsible for subjecting a quantity of aggregate to exploitation shall not be taken for the purposes of this Part to be responsible for subjecting it to commercial exploitation unless that takes place in the course or furtherance of a business carried on by him.

(3)Where by virtue of this section more than one person is charged with aggregates levy, their liabilities under this Part as persons charged with the levy shall be joint and several.

(4)In this section “connected site”, in relation to any quantity of aggregate, means any site that falls in relation to that quantity of aggregate within section 19(2)(b).

23Weight of aggregate

(1)The Commissioners may make regulations for determining the weight of any aggregate for the purposes of aggregates levy.

(2)The regulations may—

(a)prescribe rules for determining the weight;

(b)authorise rules for determining the weight to be specified by the Commissioners in a prescribed manner;

(c)authorise rules for determining the weight to be agreed between the person charged with the levy and a person acting under the authority of the Commissioners.

(3)The regulations may, in particular, provide for the rules prescribed or authorised under the regulations to include rules about—

(a)the method by which the weight is to be determined;

(b)the time by reference to which the weight is to be determined;

(c)the discounting of constituents (such as water).

(4)The regulations may include provision that rules specified by virtue of subsection (2)(b) above—

(a)are to have effect only in such cases as may be described in the rules; and

(b)are not to have effect in particular cases unless the Commissioners are satisfied that such conditions as may be set out in the rules are met in those cases.

(5)Conditions for which provision is made by virtue of subsection (4)(b) above may be framed by reference to such factors as the Commissioners think fit (such as the consent, in a particular case, of a person acting under the authority of the Commissioners).

(6)The regulations may include provision that—

(a)where rules are agreed as mentioned in subsection (2)(c) above, and

(b)the Commissioners believe that they should no longer be applied (whether because they do not give an accurate indication of the weight or are not being fully observed or for some other reason),

the Commissioners may direct that the agreed rules shall no longer have effect.

Administration and enforcement

24The register

(1)It shall be the duty of the Commissioners to establish and maintain a register of persons who are required to be registered for the purposes of aggregates levy.

(2)A person is required to be registered for the purposes of aggregates levy if he—

(a)carries out taxable activities, and

(b)is not exempted from registration by regulations under subsection (4) below.

(3)For the purposes of subsection (2) above a person carries out a taxable activity if a quantity of aggregate is subjected to commercial exploitation in the United Kingdom in circumstances in which he is responsible for its being so subjected.

(4)The Commissioners may by regulations provide for persons carrying out taxable activities to be, to such extent and subject to such conditions or restrictions as may be prescribed, either—

(a)exempt from the requirement of registration; or

(b)exempt from such obligations or liabilities imposed by or under this Part on persons required to be registered for the purposes of aggregates levy as may be prescribed.

(5)The Commissioners shall keep such information in the register as they consider it appropriate so to keep for the purposes of the care and management of aggregates levy.

(6)In particular, where it appears to the Commissioners that any person is operating or using any premises, or intends to operate or use any premises—

(a)for winning any aggregate,

(b)for carrying out an industrial crushing process in relation to any rock,

(c)for applying an exempt process to any aggregate,

(d)for storing any aggregate, or

(e)for the first landing in the United Kingdom of aggregate won from the seabed of any area of sea in the United Kingdom or United Kingdom waters,

they may, if they think fit, register those premises, in any entry relating to that person and under his name, as a registered site.

(7)Where any premises are registered in accordance with subsection (6) above as a registered site, the particulars included in the register shall set out as the boundaries of the site such boundaries as appear to the Commissioners best to secure that avoidance of levy is not facilitated by the registration of any part of any premises that is not used or operated as mentioned in subsection (6) above.

(8)Where any entry in the register at any time specifies that any premises registered under a person’s name as a registered site are to be taken to be the originating site of—

(a)any aggregate comprising rock subjected to an industrial crushing process there,

(b)any aggregate resulting from the carrying out of any exempt process there, or

(c)any aggregate won or landed there,

any question for the purposes of this Part as to the boundaries at that time of the originating site of any such aggregate shall be conclusively determined in accordance with that entry.

(9)Schedule 4 to this Act (provisions with respect to registration for the purposes of aggregates levy) shall have effect.

(10)The preceding provisions of this section and the provisions of Schedule 4 to this Act shall come into force on such date as the Treasury may by order made by statutory instrument appoint; and different days may be appointed under this subsection for different purposes.

25Returns and payment of levy

(1)The Commissioners may by regulations make provision—

(a)for persons charged with aggregates levy to be liable to account for it by reference to such periods (“accounting periods”) as may be determined by or under the regulations;

(b)for persons who are or are required to be registered for the purposes of aggregates levy to be subject to such obligations to make returns for those purposes for such periods, at such times and in such form as may be so determined; and

(c)for persons who are required to account for aggregates levy for any period to become liable to pay the amounts due from them at such times and in such manner as may be so determined.

(2)Without prejudice to the generality of the powers conferred by subsection (1) above, regulations under this section may contain provision—

(a)for aggregates levy falling in accordance with the regulations to be accounted for by reference to one accounting period to be treated in prescribed circumstances, and for prescribed purposes, as levy due for a different period;

(b)for the correction of errors made when accounting for aggregates levy by reference to any period;

(c)for the entries to be made in any accounts in connection with the correction of any such errors and for the financial adjustments to be made in that connection;

(d)for a person, for purposes connected with the making of any such entry or financial adjustment, to be required to provide to any prescribed person, or to retain, a document in the prescribed form containing prescribed particulars of the matters to which the entry or adjustment relates;

(e)for enabling the Commissioners, in such cases as they may think fit, to dispense with or relax a requirement imposed by regulations made by virtue of paragraph (d) above;

(f)for the amount of levy which, in accordance with the regulations, is treated as due for a later period than that by reference to which it should have been accounted for to be treated as increased by an amount representing interest at the rate applicable under section 197 of the Finance Act 1996 (c. 8) for such period as may be determined in accordance with the regulations.

(3)Subject to the following provisions of this section, if any person (“the taxpayer”) fails—

(a)to comply with so much of any regulations under this section as requires him, at or before a particular time, to make a return for any accounting period, or

(b)to comply with so much of any regulations under this section as requires him, at or before a particular time, to pay an amount of aggregates levy due from him,

he shall be liable to a penalty of £250.

(4)Liability to a penalty under subsection (3) above shall not arise if the taxpayer satisfies the Commissioners or, on appeal, an appeal tribunal—

(a)that there is a reasonable excuse for the failure to make the return or to pay the levy in accordance with regulations; and

(b)that there is not an occasion after the last day on which the return or payment was required by the regulations to be made when there was a failure without reasonable excuse to make it.

(5)Where, by reason of any failure falling within paragraph (a) or (b) of subsection (3) above—

(a)a person is convicted of an offence (whether under this Act or otherwise), or

(b)a person is assessed to a penalty under paragraph 7 of Schedule 6 to this Act (penalty for evasion),

that person shall not, by reason of that failure, be liable also to a penalty under that subsection (3).

(6)In subsection (1)(b) above the reference to a person who is required to be registered for the purposes of aggregates levy includes a reference to a person who would be so required but for any exemption conferred by regulations under section 24(4) above.

26Security for levy

(1)Where it appears to the Commissioners necessary to do so for the protection of the revenue they may require any person who is or is required to be registered to give security, or further security, for the payment of any aggregates levy which is or may become due from him.

(2)The power of the Commissioners to require any security, or further security, under this section shall be a power to require security, or further security, of such amount and in such manner as they may determine.

(3)A person who is responsible for any aggregate being subjected to commercial exploitation in the United Kingdom is guilty of an offence if, at the time it is so subjected—

(a)he has been required to give security under this section; and

(b)he has not complied with that requirement.

(4)A person guilty of an offence under this section shall be liable, on summary conviction, to a penalty of level 5 on the standard scale.

(5)Sections 145 to 155 of the Customs and Excise Management Act 1979 (c. 2) (proceedings for offences, mitigation of penalties and certain other matters) shall apply in relation to an offence under this section as they apply in relation to offences and penalties under the customs and excise Acts.

(6)In subsection (1) above the reference to a person who is required to be registered for the purposes of aggregates levy includes a reference to a person who would be so required but for any exemption conferred by regulations under section 24(4) above.

27Recovery and interest

Schedule 5 to this Act (which makes provision for the recovery of amounts of aggregates levy due from any person and for the interest payable on such amounts) shall have effect.

28Evasion, misdeclaration and neglect

Schedule 6 to this Act (which makes provision for and in connection with the imposition of criminal and civil penalties for the evasion of aggregates levy and for related misconduct) shall have effect.

29Information and evidence

Schedule 7 to this Act (which provides for the supply of information to the Commissioners, for the powers under which the Commissioners may collect information for enforcement purposes and about evidence) shall have effect.

Credits and repayments

30Credit for aggregates levy

(1)The Commissioners may, in accordance with the following provisions of this section, by regulations make provision in relation to cases where, after a charge to aggregates levy has arisen on any quantity of aggregate—

(a)any of that aggregate is exported from the United Kingdom in the form of aggregate;

(b)an exempt process is applied to any of that aggregate;

(c)any of that aggregate is used in a prescribed industrial or agricultural process;

(d)any of that aggregate is disposed of (by dumping or otherwise) in such manner not constituting its use for construction purposes as may be prescribed; or

(e)the whole or any part of a debt due to a person responsible for subjecting the aggregate to commercial exploitation is written off in his accounts as a bad debt.

(2)The provision that may be made in relation to any such case as is mentioned in subsection (1) above is provision—

(a)for such person as may be specified in the regulations to be entitled to a tax credit in respect of any aggregates levy charged on the aggregate in question;

(b)for a tax credit to which any person is entitled under the regulations to be brought into account when he is accounting for aggregates levy due from him for such accounting period or periods as may be determined in accordance with the regulations; and

(c)for a person entitled to a tax credit to be entitled, in any prescribed case where he cannot bring the tax credit into account so as to set it against a liability to aggregates levy, to a repayment of levy of an amount so determined.

(3)Regulations under this section may contain any or all of the following provisions—

(a)provision making any entitlement to a tax credit conditional on the making of a claim by such person, within such period and in such manner as may be prescribed;

(b)provision making entitlement to bring a tax credit into account, or to receive a repayment in respect of such a credit, conditional on compliance with such requirements as may be determined in accordance with the regulations;

(c)provision requiring a claim for a tax credit to be evidenced and quantified by reference to such records and other documents as may be so determined;

(d)provision requiring a person claiming any entitlement to a tax credit to keep, for such period and in such form and manner as may be so determined, those records and documents and a record of such information relating to the claim as may be so determined;

(e)provision for the withdrawal of a tax credit where any requirement of the regulations is not complied with;

(f)provision for interest at the rate applicable under section 197 of the Finance Act 1996 (c. 8) to be treated as added, for such period and for such purposes as may be prescribed, to the amount of any tax credit;

(g)provision for anything falling to be determined in accordance with the regulations to be determined by reference to a general or specific direction given in accordance with the regulations by the Commissioners.

(4)Without prejudice to the generality of the preceding provisions of this section, regulations under this section may also contain—

(a)provision for ascertaining whether, when and to what extent an amount is to be taken for the purposes of any regulations under this section to have been written off in any accounts as a bad debt;

(b)provision requiring a person who for the purposes of any such regulations is taken to have written off any amount as a bad debt to keep, for such period and in such form and manner as may be prescribed, information relating to anything subsequently paid in respect of the amount written off;

(c)provision for the withdrawal of the whole or an appropriate part of any tax credit relating to an amount taken to have been written off as a bad debt where the whole or any part (or further part) of the amount written off is subsequently paid;

(d)provision for ascertaining whether, and to what extent, anything received by any person is to be taken as a payment of, or of a part of, an amount taken, for the purposes of any regulations under this section, to have been written off;

(e)provision for determining the value for the purposes of provision made by virtue of paragraph (d) above of things received otherwise than in the form of money.

(5)Regulations made under this section shall have effect subject to the provisions of section 32 below.

31Repayments of overpaid levy

(1)Where a person has paid an amount to the Commissioners by way of aggregates levy which was not levy due to them, they shall be liable to repay the amount to him.

(2)The Commissioners shall not be liable to repay an amount under this section except on the making of a claim for that purpose.

(3)A claim under this section must be made in such form and manner, and must be supported by such documentary evidence, as may be required by regulations made by the Commissioners.

(4)The preceding provisions of this section are subject to the provisions of section 32 below.

(5)Except as provided by this section, the Commissioners shall not, by virtue of the fact that it was not levy due to them, be liable to repay any amount paid to them by way of aggregates levy.

32Supplemental provisions about repayments etc

(1)The Commissioners shall not be liable, on any claim for a repayment of aggregates levy, to repay any amount paid to them more than three years before the making of the claim.

(2)In the case of any claim for a repayment of an amount of aggregates levy other than a claim to a repayment to which a person is entitled by virtue of tax credit regulations, it shall be a defence to that claim that the repayment of that amount would unjustly enrich the claimant.

(3)Subsection (4) below applies for the purposes of subsection (2) above where—

(a)there is an amount paid by way of aggregates levy which (apart from subsection (2) above) would fall to be the subject of a repayment of aggregates levy to any person (“the taxpayer”); and

(b)the whole or a part of the cost of the payment of that amount to the Commissioners has, for practical purposes, been borne by a person other than the taxpayer.

(4)Where, in a case to which this subsection applies, loss or damage has been or may be incurred by the taxpayer as a result of mistaken assumptions made in his case about the operation of any provisions relating to aggregates levy, that loss or damage shall be disregarded, except to the extent of the quantified amount, in the making of any determination as to—

(a)whether or to what extent the repayment of an amount to the taxpayer would enrich him; or

(b)whether or to what extent any enrichment of the taxpayer would be unjust.

(5)In subsection (4) above “the quantified amount” means the amount (if any) which is shown by the taxpayer to constitute the amount that would appropriately compensate him for loss or damage shown by him to have resulted, for any business carried on by him, from the making of the mistaken assumptions.

(6)The reference in subsection (4) above to provisions relating to aggregates levy is a reference to any provisions of—

(a)any enactment or subordinate legislation (whether or not still in force) which relates to that levy or to any matter connected with it; or

(b)any notice published by the Commissioners under or for the purposes of any enactment or subordinate legislation relating to aggregates levy.

(7)Schedule 8 to this Act (which contains further provision about payments and repayments by the Commissioners and about the setting off of amounts due to or from the Commissioners under this Part and the setting of other amounts against such amounts) shall have effect.

Non-resident taxpayers

33Appointment of tax representatives

(1)The Commissioners may by regulations make provision for securing that every non-resident taxpayer has a person resident in the United Kingdom to act as his tax representative for the purposes of aggregates levy.

(2)Regulations under this section may, in particular, contain any or all of the following—

(a)provision requiring notification to be given to the Commissioners where a person becomes a non-resident taxpayer;

(b)provision requiring the appointment of tax representatives by non-resident taxpayers;

(c)provision for the appointment of a person as a tax representative to take effect only where the person appointed is approved by the Commissioners;

(d)provision authorising the Commissioners to give a direction requiring the replacement of a tax representative;

(e)provision authorising the Commissioners to give a direction requiring a person specified in the direction to be treated as the appointed tax representative of a non-resident taxpayer so specified;

(f)provision about the circumstances in which a person ceases to be a tax representative and about the withdrawal by the Commissioners of their approval of a tax representative;

(g)provision enabling a tax representative to act on behalf of the person for whom he is the tax representative through an agent of the representative;

(h)provision for the purposes of any provision made by virtue of paragraphs (a) to (g) above regulating the procedure to be followed in any case and imposing requirements as to the information and other particulars to be provided to the Commissioners;

(i)provision as to the time at which things done under or for the purposes of the regulations are to take effect.

(3)Subject to subsection (4) below, a person who—

(a)becomes subject, in accordance with any regulations under this section, to an obligation to request the Commissioners' approval for any person’s appointment as his tax representative, but

(b)fails (with or without making the appointment) to make the request as required by the regulations,

shall be liable to a penalty of £10,000.

(4)A failure such as is mentioned in subsection (3) above shall not give rise to liability to a penalty under this section if the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the failure.

34Effect of appointment of tax representatives

(1)The tax representative of a non-resident taxpayer shall be entitled to act on the non-resident taxpayer’s behalf for the purposes of any provision made by or under this Part.

(2)The tax representative of a non-resident taxpayer shall be under a duty, except to such extent as the Commissioners by regulations otherwise provide, to secure the non-resident taxpayer’s compliance with, and discharge of, the obligations and liabilities to which the non-resident taxpayer is subject by virtue of any provision made by or under this Part (including obligations and liabilities arising or incurred before he became the non-resident taxpayer’s tax representative).

(3)A person who is or has been the tax representative of a non-resident taxpayer shall be personally liable—

(a)in respect of any failure while he is or was the non-resident taxpayer’s tax representative to secure compliance with, or the discharge of, any obligation or liability to which subsection (2) above applies, and

(b)in respect of anything done in the course of, or for purposes connected with, acting on the non-resident taxpayer’s behalf,

as if the obligations and liabilities to which subsection (2) above applies were imposed jointly and severally on the tax representative and the non-resident taxpayer.

(4)A tax representative shall not be liable by virtue of this section to be registered for the purposes of aggregates levy; but the Commissioners may by regulations—

(a)require the registration of the names of tax representatives against the names of the non-resident taxpayers of whom they are the representatives;

(b)make provision for the deletion of the names of persons who cease to be tax representatives.

(5)A tax representative shall not by virtue of this section be guilty of any offence except in so far as—

(a)he has consented to, or connived in, the commission of the offence by the non-resident taxpayer;

(b)the commission of the offence by the non-resident taxpayer is attributable to any neglect on the part of the tax representative; or

(c)the offence consists in a contravention by the tax representative of an obligation which, by virtue of this section, is imposed both on the tax representative and on the non-resident taxpayer.

Other special cases

35Groups of companies etc

(1)Schedule 9 to this Act (which provides for two or more bodies corporate to be treated as members of the same group for the purposes of this Part) shall have effect.

(2)Any aggregates levy with which a body corporate is charged in respect of aggregate subjected to commercial exploitation at a time when the body is a member of a group shall be treated for the purposes of this Part as if it were the representative member for that group (instead of that body) which is charged with the levy.

(3)All the bodies corporate who are members of a group when any aggregates levy becomes due from the representative member, together with any bodies corporate who become members of the group while any such levy remains unpaid, shall be jointly and severally liable for any aggregates levy due from the representative member.

(4)Subject to subsections (2) and (3) above, the Commissioners may by regulations make such provision as they consider appropriate about—

(a)the person by whom any obligation or liability imposed by or under this Part is to be performed or discharged, and

(b)the manner in which it is to be performed or discharged,

in a case where the person who (apart from the regulations) would be subject to the obligation or liability is one of a number of bodies corporate registered in the name of the representative member for a group.

(5)References in this section to aggregates levy being or becoming due from the representative member include references to any amounts being or becoming recoverable as if they were aggregates levy due from that member.

(6)For the purposes of this Part—

(a)a body corporate is a member of a group at any time in relation to which it falls to be treated as such a member in accordance with Schedule 9 to this Act; and

(b)the body corporate which is to be taken to be the representative member for a group at any time is the member of the group which in relation to that time is the representative member under that Schedule in the case of that group.

36Partnerships and other unincorporated bodies

(1)The Commissioners may by regulations make provision for determining by what persons anything required to be done under this Part is to be done where, apart from those regulations, that requirement would fall on—

(a)persons carrying on business in partnership; or

(b)persons carrying on business together as an unincorporated body;

but any regulations under this subsection must be construed subject to the following provisions of this section.

(2)In determining for the purposes of this Part who at any time is the person chargeable with any aggregates levy where the persons responsible for subjecting any aggregate to commercial exploitation are persons carrying on any business—

(a)in partnership, or

(b)as an unincorporated body,

the firm or body shall be treated, for the purposes of that determination (and notwithstanding any changes from time to time in the members of the firm or body), as the same person and as separate from its members.

(3)Without prejudice to section 36 of the Partnership Act 1890 (c. 39) (rights of persons dealing with firm against apparent members of firm), where—

(a)persons have been carrying on in partnership any business in the course or furtherance of which any aggregate has been subjected to commercial exploitation, and

(b)a person ceases to be a member of the firm,

that person shall be regarded for the purposes of this Part (including subsection (7) below) as continuing to be a partner until the date on which the change in the partnership is notified to the Commissioners.

(4)Where a person ceases to be a member of a firm during an accounting period (or is treated as so ceasing by virtue of subsection (3) above) any notice, whether of assessment or otherwise, which—

(a)is served on the firm under or for the purposes of any provision made by or under this Part, and

(b)relates to, or to any matter arising in, that period or any earlier period during the whole or part of which he was a member of the firm,

shall be treated as served also on him.

(5)Without prejudice to section 16 of the Partnership Act 1890 (c. 39) (notice to acting partner to be notice to the firm), any notice, whether of assessment or otherwise, which—

(a)is addressed to a firm by the name in which it is registered, and

(b)is served in accordance with this Part,

shall be treated for the purposes of this Part as served on the firm and, accordingly, where subsection (4) above applies, as served also on the former partner.

(6)Subject to subsection (7) below, nothing in this section shall affect the extent to which, under section 9 of the Partnership Act 1890 (liability of partners for debts of the firm), a partner is liable for aggregates levy owed by the firm.

(7)Where a person is a partner in a firm during part only of an accounting period, his personal liability for aggregates levy incurred by the firm in respect of aggregate subjected to commercial exploitation in that period shall include, but shall not exceed, such proportion of the firm’s liability as may be just and reasonable in the circumstances.

37Insolvency etc

(1)The Commissioners may by regulations make provision in accordance with the following provisions of this section for the application of this Part in cases in which an insolvency procedure is applied to a person or to a deceased person’s estate.

(2)The provision that may be contained in regulations under this section may include any or all of the following—

(a)provision requiring any such person as may be prescribed to give notification to the Commissioners, in the prescribed manner, of the prescribed particulars of any relevant matter;

(b)provision requiring a person to be treated, to the prescribed extent, as if, for the purposes of this Part or such of its provisions as may be prescribed, he were the same person as the subject of the procedure; and

(c)provision for securing continuity in the application of any of the provisions of this Part where, by virtue of any regulations under this section, any person is treated as if he were the same person as the subject of the procedure.

(3)In subsection (2) above “relevant matter”, in relation to a case in which an insolvency procedure is applied to any person or estate, means—

(a)the application of that procedure to that person or estate;

(b)the appointment of any person for the purposes of the application of that procedure;

(c)any other matter relating to—

(i)the application of that procedure to the subject of the procedure or to his estate;

(ii)the holding of an appointment made for the purposes of that procedure; or

(iii)the exercise or discharge of any powers or duties conferred or imposed on any person by virtue of such an appointment.

(4)Regulations made by virtue of subsection (2)(b) above may include provision for a person to cease, on the occurrence of such an event as may be prescribed, to be treated as if he were the same person as the subject of the procedure.

(5)Regulations under this section prescribing the manner in which any notification is to be given to the Commissioners may require it to be given in such manner and to contain such particulars as may be specified in a general notice published by the Commissioners in accordance with the regulations.

(6)Regulations under this section may provide that the extent to which, and the purposes for which, a person is to be treated under the regulations as if he were the same person as the subject of the procedure may be determined by reference to a notice given in accordance with the regulations to the person so treated.

(7)For the purposes of this section, an insolvency procedure is applied to a person if—

(a)a bankruptcy order, winding-up order or administration order is made in relation to that person or a partnership of which he is a member;

(b)an award of sequestration is made in relation to that person’s estate or the estate of a partnership of which he is a member;

(c)that person is put into administrative receivership;

(d)that person passes a resolution for voluntary winding up;

(e)any voluntary arrangement approved in accordance with—

(i)Part 1 or 8 of the Insolvency Act 1986 (c. 45), or

(ii)Part II or Chapter II of Part VIII of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)) ,

comes into force in relation to that person or a partnership of which that person is a member;

(f)a deed of arrangement registered in accordance with—

(i)the Deeds of Arrangement Act 1914 (c. 47), or

(ii)Chapter I of Part VIII of that Order,

takes effect in relation to that person;

(g)a person is appointed as the receiver or manager of some or all of that person’s property, or of income arising from some or all of his property;

(h)a person is appointed as the interim receiver of some or all of that person’s property under section 286 of the Insolvency Act 1986 or Article 259 of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/ 2405 (N.I. 19)));

(i)a person is appointed as the provisional liquidator in relation to that person under section 135 of that Act or Article 115 of that Order;

(j)an interim order is made under Part 8 of that Act, or Chapter II of Part VIII of that Order, in relation to that person; or

(k)that person’s estate becomes vested in any other person as that person’s trustee under a trust deed (within the meaning of the Bankruptcy (Scotland) Act 1985 (c. 66)).

(8)For the purposes of this section, an insolvency procedure is applied to a deceased person’s estate if—

(a)after that person’s death—

(i)a bankruptcy order, or

(ii)an order with corresponding effect but a different name,

is made in relation to that person’s estate under any of the provisions of the Insolvency Act 1986 (c. 45) or the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19) ) as they are applied to the administration of the insolvent estates of deceased persons; or

(b)an award of sequestration is made on that person’s estate after his death.

(9)In subsection (7) above—

(a)the reference to any administration order is a reference to an administration order under section 8 of the Insolvency Act 1986 or Article 21 of the Insolvency (Northern Ireland) Order 1989;

(b)the reference to a person being put into administrative receivership is a reference to the appointment in relation to him of an administrative receiver, within the meaning of section 251 of that Act of 1986 or Article 5(1) of that Order of 1989; and

(c)references to a member of a partnership include references to any person who is liable as a partner under section 14 of the Partnership Act 1890 (c. 39) (persons liable by “holding out”).

(10)In this section “the subject of the procedure”, in relation to the application of any insolvency procedure, means the person to whom, or to whose estate, the procedure is applied.

38Death and incapacity

(1)The Commissioners may, in accordance with subsection (2) below, by regulations make provision for the purposes of aggregates levy in relation to cases where a person carries on a business of an individual who has died or become incapacitated.

(2)The provisions that may be contained in regulations under this section are—

(a)provision requiring the person who is carrying on the business to inform the Commissioners of the fact that he is carrying on the business and of the event that has led to his carrying it on;

(b)provision allowing that person to be treated for a limited time as if he and the person who has died or become incapacitated were the same person; and

(c)such other provision as the Commissioners think fit for securing continuity in the application of this Part where a person is so treated.

39Transfer of a business as a going concern

(1)The Commissioners may by regulations make provision for securing continuity in the application of this Part in cases where any business carried on by a person is transferred to another person as a going concern.

(2)Regulations under this section may, in particular, include any or all of the following—

(a)provision requiring the transferor to inform the Commissioners of the transfer;

(b)provision for liabilities and duties under this Part of the transferor to become, to such extent as may be provided by the regulations, liabilities and duties of the transferee;

(c)provision for any right of either of them to a tax credit or repayment of aggregates levy to be satisfied by allowing the credit or making the repayment to the other;

(d)provision as to the preservation of any records or accounts relating to the business which, by virtue of any regulations under paragraph 2 of Schedule 7 to this Act, are required to be preserved for any period after the transfer.

(3)Regulations under this section may provide that no such provision as is mentioned in paragraph (b) or (c) of subsection (2) above shall have effect in relation to any transferor and transferee unless an application for the purpose has been made by them under the regulations.

Review and appeal

40Review of Commissioners' decisions

(1)This section applies to any decision of the Commissioners with respect to any of the following matters—

(a)whether or not a person is charged in any case with an amount of aggregates levy;

(b)the amount of aggregates levy charged in any case and the time when the charge is to be taken as having arisen;

(c)the registration of any person or premises for the purposes of aggregates levy or the cancellation of any registration;

(d)the person liable to pay the aggregates levy charged in any case, the amount of a person’s liability to aggregates levy and the time by which he is required to pay an amount of that levy;

(e)the imposition of a requirement on any person to give security, or further security, under section 26 above and the amount and manner of providing any security required under that section;

(f)whether or not liability to a penalty or to interest on any amount arises in any person’s case under any provision made by or under this Part, and the amount of any such liability;

(g)any matter the decision as to which is reviewable under this section in accordance with paragraph 8(6) or (7) of Schedule 6 to this Act;

(h)the extent of any person’s entitlement to any tax credit or to a repayment in respect of a tax credit and the extent of any liability of the Commissioners under this Part to pay interest on any amount;

(i)whether or not any person is required to have a tax representative by virtue of any regulations under section 33 above;

(j)the giving, withdrawal or variation, for the purposes of any such regulations, of any approval or direction with respect to the person who is to act as another’s tax representative;

(k)whether a body corporate is to be treated, or is to cease to be treated, as a member of a group, the times at which a body corporate is to be so treated and the body corporate which is, in relation to any time, to be the representative member for a group;

(l)any matter not falling within the preceding paragraphs the decision with respect to which is contained in any assessment under this Part.

(2)Any person who is or will be affected by any decision to which this section applies may by notice in writing to the Commissioners require them to review the decision.

(3)The Commissioners shall not be required under this section to review any decision unless the notice requiring the review is given before the end of the period of forty-five days beginning with the day on which written notification of the decision, or of an assessment containing or giving effect to the decision, was first given to the person requiring the review.

(4)For the purposes of subsection (3) above it shall be the duty of the Commissioners to give written notification of any decision to which this section applies to any person who—

(a)requests such a notification;

(b)has not previously been given written notification of that decision; and

(c)if given such a notification, will be entitled to require a review of the decision under this section.

(5)A person shall be entitled to give a notice under this section requiring a decision to be reviewed for a second or subsequent time only if—

(a)the grounds on which he requires the further review are that the Commissioners did not, on any previous review, have the opportunity to consider certain facts or other matters; and

(b)he does not, on the further review, require the Commissioners to consider any facts or matters which were considered on a previous review except in so far as they are relevant to any issue to which the facts or matters not previously considered relate.

(6)Where the Commissioners are required by a notice under this section to review any decision, it shall be their duty to do so.

(7)On a review under this section the Commissioners may (subject to subsection (9) below) withdraw, vary or confirm the decision reviewed.

(8)Where—

(a)it is the duty under this section of the Commissioners to review any decision, and

(b)they do not, within the period of forty-five days beginning with the day on which the review was required, give notice to the person requiring it of their determination on the review,

they shall be deemed to have confirmed the decision.

(9)Where the Commissioners decide, on a review under this section, that a liability to a penalty or to an amount of interest arises, they shall not be entitled to modify the amount payable in respect of that liability except—

(a)in exercise of a power conferred by section 46(1) below (penalties) or paragraph 10(3) of Schedule 5 to this Act, paragraph 6(6) of Schedule 8 to this Act or paragraph 5(5) of Schedule 10 to this Act (penalty interest); or

(b)for the purpose of making the amount payable conform to the amount of the liability imposed by this Part.

(10)This section has effect subject to paragraph 8(5) of Schedule 6 to this Act.

41Appeals against reviewed decisions

(1)Subject to the following provisions of this section, an appeal shall lie to an appeal tribunal with respect to any of the following decisions—

(a)any decision by the Commissioners on a review under section 40 above (including a deemed confirmation under subsection (8) of that section);

(b)any decision by the Commissioners on any such review of a decision referred to in section 40(1) above as the Commissioners have agreed to undertake in consequence of a request made after the end of the period mentioned in section 40(3) above.

(2)Where an appeal under this section relates to a decision (whether or not contained in an assessment) that an amount of aggregates levy is due from any person, that appeal shall not be entertained unless—

(a)the amount which the Commissioners have determined to be due has been paid or deposited with them; or

(b)on being satisfied that the appellant would otherwise suffer hardship—

(i)the Commissioners agree, or

(ii)the tribunal decide,

that it should be entertained notwithstanding that that amount has not been so paid or deposited.

(3)On an appeal under this section relating to a penalty under paragraph 7 of Schedule 6 to this Act (evasion), the burden of proof as to the matters specified in paragraphs (a) to (c) of sub-paragraph (1) of that paragraph shall lie upon the Commissioners.

42Determinations on appeal

(1)Where, on an appeal under section 41 above—

(a)it is found that an assessment of the appellant made, confirmed or treated as confirmed by the Commissioners on a review under section 40 above (“the original assessment”) is an assessment for an amount that is less than it ought to have been, and

(b)the tribunal give a direction specifying the correct amount,

the assessment shall have effect as an assessment of the amount specified in the direction and (without prejudice to any power under this Part to reduce the amount of interest payable on the amount of an assessment) as if it were an assessment notified to the appellant in that amount at the same time as the original assessment.

(2)On an appeal under section 41 above, the powers of the appeal tribunal in relation to any decision of the Commissioners shall include a power, where the tribunal allow an appeal on the ground that the Commissioners could not reasonably have arrived at the decision, either—

(a)to direct that the decision, so far as it remains in force, is to cease to have effect from such time as the tribunal may direct; or

(b)to require the Commissioners to conduct, in accordance with the directions of the tribunal, a further review of the original decision.

(3)Where, on an appeal under section 41 above, the appeal tribunal find that a liability to a penalty or to an amount of interest arises, the tribunal shall not give any direction for the modification of the amount payable in respect of that liability except—

(a)in exercise of a power conferred on the tribunal by section 46(1) below (penalties) or paragraph 10(3) or (6) of Schedule 5 to this Act, paragraph 6(6) or (9) of Schedule 8 to this Act or paragraph 5(5) or (8) of Schedule 10 to this Act (penalty interest); or

(b)for the purpose of making the amount payable conform to the amount of the liability imposed by this Part.

(4)Where, on an appeal under section 41 above, it is found that the whole or part of any amount paid or deposited in pursuance of section 41(2) above is not due, so much of that amount as is found not to be due shall be repaid with interest at such rate as the tribunal may determine.

(5)Where, on an appeal under section 41 above, it is found that the whole or part of any amount due to the appellant by way of any repayment in respect of a tax credit has not been paid, so much of that amount as is found not to have been paid shall be paid with interest at such rate as the tribunal may determine.

(6)Where—

(a)an appeal under section 41 above has been entertained notwithstanding that an amount determined by the Commissioners to be payable as aggregates levy has not been paid or deposited, and

(b)it is found on the appeal that that amount is due,

the tribunal may, if they think fit, direct that that amount shall be paid with interest at such rate as may be specified in the direction.

(7)Sections 85 and 87 of the Value Added Tax Act 1994 (c. 23) (settling of appeals by agreement and enforcement of certain decisions of tribunal) shall have effect as if—

(a)the references to section 83 of that Act included references to section 41 above; and

(b)the references to value added tax included references to aggregates levy.

43Adjustments of contracts

(1)Where—

(a)an agreement to supply a quantity of aggregate to any person has been entered into at any time before the commencement date, and

(b)on or after that date aggregates levy is charged on that quantity of aggregate,

so much of the agreement as requires any payment to be made to the supplier at the time when or after the charge to levy on that quantity of aggregate arises shall be adjusted so as to secure that the cost of discharging the liability to pay the levy, to the extent that it would otherwise have been borne by the supplier, is borne by the person making the payment.

(2)Where—

(a)an agreement with regard to any sum payable in respect of the use of land (whether the sum is called rent or royalty or otherwise) provides that the amount of the sum is to be calculated by reference to—

(i)the turnover of a business, or

(ii)the price received for minerals extracted from the land,

(b)the agreement was entered into before commencement date, and

(c)the circumstances are such that (had the agreement been made on or after that date) it might reasonably be expected that it would have provided that aggregates levy charged in particular circumstances be ignored in calculating the turnover or price,

the agreement shall be taken to provide that aggregates levy charged in those circumstances shall be ignored in calculating the turnover or, as the case may be, price.

General provisions

44Destination of receipts

All money and securities for money collected or received for or on account of aggregates levy shall—

(a)if collected or received in Great Britain, be placed to the general account of the Commissioners kept at the Bank of England under section 17 of the Customs and Excise Management Act 1979 (c. 2); and

(b)if collected or received in Northern Ireland, be paid into the Consolidated Fund of the United Kingdom in such manner as the Treasury may direct.

45Regulations and orders

(1)The powers of the Commissioners under this Part to make regulations shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons.

(2)Where regulations made under this Part impose a relevant requirement on any person, they may provide that if the person fails to comply with the requirement he shall be liable, subject to subsection (3) below, to a penalty of £250.

(3)Where by reason of any conduct—

(a)a person is convicted of an offence (whether under this Act or otherwise), or

(b)a person is assessed to a penalty under paragraph 7 of Schedule 6 to this Act,

that person shall not by reason of that conduct be liable also to a penalty under any regulations under this Part.

(4)In subsection (2) above “relevant requirement” means any requirement other than one the penalty for a contravention of which is specified in section 25(3) or 33(3) above or in paragraph 2 of Schedule 7 to this Act.

(5)Subject to subsection (6) below, a power under this Part to make any provision by order or regulations—

(a)may be exercised so as to apply the provision only in such cases as may be described in the order or regulations;

(b)may be exercised so as to make different provision for different cases or descriptions of case; and

(c)shall include power by the order or regulations to make such supplementary, incidental, consequential or transitional provision as the Treasury or, as the case may be, the Commissioners may think fit.

(6)Subsection (5) above does not apply to an order under section 16(6) or 24(10) above.

46Civil penalties

(1)Where a person is liable to a civil penalty imposed by or under this Part—

(a)the Commissioners or, on appeal, an appeal tribunal may reduce the penalty to such amount (including nil) as they think proper; but

(b)on an appeal relating to any penalty reduced by the Commissioners, an appeal tribunal may cancel the whole or any part of the Commissioners' reduction.

(2)In determining whether a civil penalty should be, or should have been, reduced under subsection (1) above, no account shall be taken of any of the following matters, that is to say—

(a)the insufficiency of the funds available to any person for paying any aggregates levy due or for paying the amount of the penalty;

(b)the fact that there has, in the case in question or in that case taken with any other cases, been no or no significant loss of aggregates levy;

(c)the fact that the person liable to the penalty or a person acting on his behalf has acted in good faith.

(3)For the purposes of any provision made by or under this Part under which liability to a civil penalty does not arise in respect of conduct for which there is shown to be a reasonable excuse—

(a)an insufficiency of funds available for paying any amount is not a reasonable excuse; and

(b)where reliance has been placed on any other person to perform any task, neither the fact of that reliance nor any conduct of the person relied upon is a reasonable excuse.

(4)Schedule 10 to this Act (which makes provision about the assessment of civil penalties imposed and about interest on such penalties) shall have effect.

(5)If it appears to the Treasury that there has been a change in the value of money since the time when the amount of a civil penalty provided for by this Part was fixed, they may by order made by statutory instrument substitute, for the amount for the time being specified as the amount of that penalty, such other sum as appears to them to be justified by the change.

(6)In subsection (5) above the reference to the time when the amount of a civil penalty was fixed is a reference—

(a)in the case of a penalty which has not previously been modified under that subsection, to the time of the passing of this Act; and

(b)in any other case, to the time of the making of the order under that subsection that made the most recent modification of the amount of that penalty.

(7)An order under subsection (5) above—

(a)shall not be made unless a draft of the order has been laid before Parliament and approved by resolution of the House of Commons; and

(b)shall not apply to the penalty for any conduct before the coming into force of the order.

(8)In this section “civil penalty” means any penalty liability to which arises otherwise than in consequence of a person’s conviction for a criminal offence.

47Service of notices etc

(1)Any notice, notification or requirement that is to be or may be served on, given to or imposed on any person for the purposes of any provision made by or under this Part may be served, given or imposed by sending it to that person or his tax representative by post in a letter addressed to that person or representative at the latest or usual residence or place of business of that person or representative.

(2)Any direction required or authorised by or under this Part to be given by the Commissioners may be given by sending it by post in a letter addressed to each person affected by it at his latest or usual residence or place of business.

(3)Any direction, notice or notification required or authorised by or under this Part to be given by the Commissioners may be withdrawn or varied by them by a direction, notice or notification given in the same manner as the one withdrawn or varied.

48Interpretation of Part

(1)In this Part—

  • “accounting period” means a period which, in pursuance of any regulations under section 25(1) above, is an accounting period for the purposes of aggregates levy;

  • “aggregate” shall be construed in accordance with sections 17(1) and 18 above;

  • “agreement” includes any arrangement or understanding (whether or not legally enforceable), and cognate expressions shall be construed accordingly;

  • “agricultural” means agricultural within the meaning of the Agriculture Act 1967 (c. 22) or the Agriculture Act (Northern Ireland) 1949 (c. 2 (N.I.));

  • “appeal tribunal” means a VAT and duties tribunal;

  • “the commencement date” has the meaning given by section 16(6) above;

  • “commercial exploitation” shall be construed in accordance with section 19 above;

  • “the Commissioners” means the Commissioners of Customs and Excise;

  • “conduct” includes acts and omissions;

  • “construction purposes” shall be construed in accordance with subsection (2) below;

  • “exempt process” shall be construed in accordance with section 18(2) above;

  • “forestry” includes the cultivation, maintenance and care of trees or woodland of any description;

  • “gravel” includes gravel comprising or containing pebbles or stones or both;

  • “limestone” includes chalk and dolomite;

  • “member”, in relation to a group, shall be construed in accordance with section 35(6) above;

  • “mixed” includes blended, and cognate expressions shall be construed accordingly;

  • “non-resident taxpayer” means a person who—

    (a)

    is or is required to be registered for the purposes of aggregates levy, or would be so required but for an exemption by virtue of regulations under section 24(4) above; and

    (b)

    is not resident in the United Kingdom;

  • “operate” and “operator”, in relation to any site, shall be construed in accordance with section 21 above;

  • “originating site” shall be construed in accordance with section 20 above;

  • “prescribed” means prescribed by regulations made by the Commissioners under this Part;

  • “registered” means registered in the register maintained under section 24 above;

  • “representative member”, in relation to a group, shall be construed in accordance with section 35(6) above;

  • “rock” does not include any rock contained in a quantity of aggregate consisting wholly or mainly of gravel or sand;

  • “structure” includes roads and paths, the way on which any railway track is or is to be laid and embankments;

  • “subordinate legislation” has the same meaning as in the Interpretation Act 1978 (c. 30);

  • “tax credit” means a tax credit for which provision is made by tax credit regulations;

  • “tax credit regulations” means regulations under section 30 above;

  • “tax representative”, in relation to any person, means the person who, in accordance with any regulations under section 33 above, is for the time being that person’s tax representative for the purposes of aggregates levy;

  • “taxable aggregate” shall be construed in accordance with section 17(2) to (4) above;

  • “United Kingdom waters” means—

    (a)

    the territorial sea adjacent to the United Kingdom; or

    (b)

    any area designated by Order in Council under section 1(7) of the Continental Shelf Act 1964 (c. 29).

(2)References in this Part to the use of anything for construction purposes are references to either of the following, except in so far as it consists in the application to it of an exempt process, that is to say—

(a)using it as material or support in the construction or improvement of any structure;

(b)mixing it with anything as part of the process of producing mortar, concrete, tarmacadam, coated roadstone or any similar construction material.

(3)References in this Part to winning any aggregate are references to winning it—

(a)by quarrying, dredging, mining or collecting it from any land or area of the seabed; or

(b)by separating it in any other manner from any land or area of the seabed in which it is comprised.

(4)References in this Part, in relation to any accounting period, to aggregates levy due from any person for that period are references (subject to any regulations made by virtue of section 25(2)(a) above) to the aggregates levy for which that person is required, in accordance with regulations under section 25 above, to account by reference to that period.

(5)References in this Part to a repayment of aggregates levy or of an amount of aggregates levy are references to any repayment of an amount to any person by virtue of—

(a)any tax credit regulations;

(b)section 31 above;

(c)paragraph 11(3) of Schedule 5 to this Act; or

(d)paragraph 6(3) of Schedule 10 to this Act.

(6)For the purposes of this Part a person is resident in the United Kingdom at any time if, at that time—

(a)that person has an established place of business in the United Kingdom;

(b)that person has a usual place of residence in the United Kingdom; or

(c)that person is a firm or unincorporated body which (without being resident in the United Kingdom by virtue of paragraph (a) above) has amongst its partners or members at least one individual with a usual place of residence in the United Kingdom.

Supplemental

49Minor and consequential amendments

(1)In section 1(1) of the Provisional Collection of Taxes Act 1968 (c. 2) (taxes in relation to which resolutions may have temporary statutory effect), after “landfill tax,” there shall be inserted “aggregates levy,”.

(2)In section 197(2) of the Finance Act 1996 (c. 8) (enactments for which interest rates are set under section 197), after paragraph (g) there shall be inserted—

(h)the following provisions of the Finance Act 2001 (interest payable to or by the Commissioners in connection with aggregates levy), that is to say—

(i)sections 25(2)(f) and 30(3)(f);

(ii)paragraph 8(3)(a) of Schedule 5; and

(iii)paragraphs 2 and 6(1)(b) of Schedule 8..

(3)In section 827 of the Taxes Act 1988 (no deduction for penalties etc.), the following subsection shall be inserted after subsection (1D)—

(1E)Where a person is liable to make a payment by way of—

(a)any penalty under any provision of Part 2 of the Finance Act 2001 (aggregates levy),

(b)interest under any of paragraphs 5 to 9 of Schedule 5 to that Act (interest on aggregates levy due and on interest),

(c)interest under paragraph 6 of Schedule 8 to that Act (interest on recoverable overpayments etc.), or

(d)interest under paragraph 5 of Schedule 10 to that Act (interest on penalties),

the payment shall not be allowed as a deduction in computing any income, profits or losses for any tax purposes..

Part 3Income tax, corporation tax and capital gains tax

Chapter 1Charge and rates

Income tax

50Charge and rates for 2001-02

Income tax shall be charged for the year 2001-02, and for that year—

(a)the starting rate shall be 10%,

(b)the basic rate shall be 22%, and

(c)the higher rate shall be 40%.

51Starting rate limit for 2001-02

(1)For the year 2001-02 the amount specified in section 1(2)(aa) of the Taxes Act 1988 (the starting rate limit) shall be £1,880.

(2)Accordingly, section 1(4) of that Act (indexation), so far as it relates to the amount so specified, does not apply for that year.

52Children’s tax credit: amount for 2001-02 and subsequent years

(1)In section 257AA(2) of the Taxes Act 1988 (which specifies the amount by reference to which the children’s tax credit is calculated) for “£4,420” substitute “£5,200”.

(2)This section has effect for the year 2001-02 and subsequent years of assessment.

53Children’s tax credit: baby rate

(1)After section 257AA(2) of the Taxes Act 1988 (which specifies the amount by reference to which the children’s tax credit is calculated) insert—

(2A)For a year of assessment during the whole or part of which a qualifying baby (or more than one) is resident with the claimant, subsection (2) above has effect as if the amount specified there were increased by £5,200..

(2)After subsection (3) of that section (reduction of amount where claimant has income within the higher rate band) insert—

(3A)Where subsection (2A) above applies, the reference in subsection (3) above to the amount specified in subsection (2) above is to the higher amount applicable by virtue of subsection (2A) above..

(3)After subsection (4) of that section (meaning of “qualifying child”) insert—

(4A)In this section “qualifying baby”, in relation to a year of assessment, means a qualifying child born in that year..

(4)In section 257C(1) and (3) of the Taxes Act 1988 (indexation) for “257AA(2)” substitute “257AA(2) and (2A)”.

(5)Schedule 13B to the Taxes Act 1988 (children’s tax credit: provisions applicable where child lives with more than one adult in a year of assessment) is amended in accordance with Schedule 11 to this Act.

(6)Subsections (1) to (3) and (5) above have effect for the year 2002-03 and subsequent years of assessment.

(7)Subsection (4) above has effect for the purposes of the application of section 257AA of the Taxes Act 1988 for the year 2003-04 and subsequent years of assessment.

Corporation tax

54Charge and main rate for financial year 2002

Corporation tax shall be charged for the financial year 2002 at the rate of 30%.

55Small companies' rate and fraction for financial year 2001

For the financial year 2001—

(a)the small companies' rate shall be 20%, and

(b)the fraction mentioned in section 13(2) of the Taxes Act 1988 (marginal relief for small companies) shall be one fortieth.

56Corporation tax starting rate and fraction for financial year 2001

For the financial year 2001—

(a)the corporation tax starting rate shall be 10%, and

(b)the fraction mentioned in section 13AA(3) of the Taxes Act 1988 (marginal relief for small companies) shall be one fortieth.

Chapter 2Other provisions

Employment

57Mileage allowances: exemptions and relief

(1)In Chapter 4 of Part 5 of the Taxes Act 1988 (provisions relating to the Schedule E charge: other exemptions and reliefs), after section 197AC insert—

Mileage allowances
197ADMileage allowance payments

(1)There is no charge to tax under Schedule E in respect of approved mileage allowance payments for a qualifying vehicle.

(2)Mileage allowance payments are amounts (other than passenger payments within the meaning of section 197AE(2)) paid to an employee in respect of expenses in connection with the use by him for business travel of a qualifying vehicle.

(3)Mileage allowance payments are approved only if, or to the extent that, for a tax year, the total amount of all the mileage allowance payments made to the employee for the kind of vehicle in question does not exceed the approved amount for mileage allowance payments applicable to that kind of vehicle.

(4)Subsection (1) above does not apply if—

(a)the employee is a passenger in the vehicle, or

(b)the vehicle is a company vehicle.

197AEPassenger payments

(1)There is no charge to tax under Schedule E in respect of approved passenger payments made to an employee for a car or van (whether or not it is a company vehicle) if—

(a)mileage allowance payments (within the meaning of section 197AD(2)) are made to the employee for the car or van, and

(b)if the car or van is made available to the employee by reason of his employment, he is chargeable to tax in respect of it under section 157 or 159AA (cars and vans made available for private use).

(2)Passenger payments are amounts paid to an employee because, while using a car or van for business travel, he carries one or more qualifying passengers in it.

  • “Qualifying passenger” means a passenger who is also an employee for whom the travel is business travel.

(3)Passenger payments are approved only if, or to the extent that, for a tax year, the total amount of all the passenger payments made to the employee does not exceed the approved amount for passenger payments.

(4)Section 168(6) (when cars and vans are made available by reason of employment) applies for the purposes of subsection (1)(b) above.

197AFMileage allowance relief

(1)An employee is entitled to mileage allowance relief for a tax year if the employee uses a qualifying vehicle for business travel and—

(a)no mileage allowance payments are made to him for the kind of vehicle in question for the tax year, or

(b)the total amount of all the mileage allowance payments made to him for the kind of vehicle in question for the tax year is less than the approved amount for mileage allowance payments applicable to that kind of vehicle.

(2)Subsection (1) above does not apply if—

(a)the employee is a passenger in the vehicle, or

(b)the vehicle is a company vehicle.

(3)The amount of mileage allowance relief to which an employee is entitled for a tax year is—

(a)if subsection (1)(a) above applies, the approved amount for mileage allowance payments applicable to the kind of vehicle in question;

(b)if subsection (1)(b) above applies, the difference between the total amount of all the mileage allowance payments made to the employee for the kind of vehicle in question and the approved amount for mileage allowance payments applicable to that kind of vehicle.

(4)In this section “mileage allowance payments” has the meaning given by section 197AD(2).

197AGGiving effect to mileage allowance relief

(1)Mileage allowance relief to which an employee is entitled for a tax year is given effect as follows.

(2)Where any emoluments of the employment fall within Case I or IIof Schedule E, the relief is allowed as a deduction from those emoluments in calculating the amount chargeable to tax for that tax year.

(3)In the case of emoluments chargeable under Case III of Schedule E for a tax year there may be deducted from those emoluments the amount of any mileage allowance relief—

(a)for that tax year, and

(b)for any earlier tax year in which the employee was resident in the United Kingdom,

which might have been deducted from the emoluments of the employment for the tax year for which the employee is entitled to the relief if those emoluments had been chargeable under Case I of Schedule E.

(4)Subsection (3) above applies only to the extent that the mileage allowance relief cannot be deducted under subsection (2) above.

(5)A deduction shall not be made twice, whether under subsection (2) or (3) above, in respect of the same mileage allowance relief.

197AHInterpretation of sections 197AD to 197AG

Schedule 12AA to this Act defines terms used in sections 197AD to 197AG..

(2)In the Taxes Act 1988 insert as Schedule 12AA the Schedule set out in Part 1 of Schedule 12 to this Act.

(3)The consequential amendments in Part 2 of Schedule 12 to this Act have effect.

(4)This section has effect for the year 2002-03 and subsequent years of assessment.

58Mileage allowances: nil liability notices

(1)This section applies if—

(a)mileage allowance payments are made to an employee or office-holder in respect of the use of a vehicle that is not a company vehicle, or

(b)mileage allowance relief is available in respect of the use by an employee or office-holder of a vehicle.

(2)A nil liability notice in force immediately before 6th April 2002 shall cease to have effect in relation to—

(a)payments made, or

(b)benefits, facilities, non-cash vouchers, credit-tokens or cash vouchers provided,

in respect of expenses incurred in connection with the use of the vehicle by the employee or office-holder for business travel.

(3)In subsection (2) “nil liability notice” means a notice under—

(a)section 144(1) of the Taxes Act 1988 (notice of nil liability in respect of non-cash vouchers, credit-tokens or cash vouchers), or

(b)section 166(1) of that Act (notice of nil liability in respect of payments, benefits or facilities).

(4)In this section—

  • “business travel” has the meaning given by paragraph 2 of Schedule 12AA to the Taxes Act 1988;

  • “company vehicle” has the meaning given by paragraph 6 of Schedule 12AA to that Act; and

  • “mileage allowance payments” has the meaning given by section 197AD(2) of that Act.

59Employees' vehicles: withdrawal of capital allowances

(1)In Chapter 3 of Part 2 of the Capital Allowances Act 2001 (c. 2) (plant and machinery: qualifying expenditure), for section 36 (restriction on qualifying expenditure in case of employment or office) substitute—

36Restriction on qualifying expenditure in case of employment or office

(1)Where the qualifying activity consists of an employment or office—

(a)expenditure on the provision of a mechanically propelled road vehicle, or a cycle, is not qualifying expenditure, and

(b)other expenditure is qualifying expenditure only if the plant or machinery is necessarily provided for use in the performance of the duties of the employment or office.

(2)In this section “cycle” has the meaning given by section 192(1) of the Road Traffic Act 1988..

(2)Section 80 of that Act (vehicles provided for purposes of employment or office) is repealed.

(3)The above amendments apply to expenditure incurred on or after 6th April 2002.

(4)Where immediately before 6th April 2002—

(a)expenditure incurred by an employee on the provision of a mechanically propelled road vehicle, or a cycle, was qualifying expenditure for the purposes of Part 2 of the Capital Allowances Act 2001 (c. 2) , and

(b)the employee is treated for the purposes of that Part as owning an asset as a result of that expenditure having been incurred,

the employee shall be treated for the purposes of that Part of that Act as if he had ceased to own the asset at that time.

(5)In subsection (4)—

  • “employee” includes an office-holder; and

  • “cycle” has the meaning given by section 192(1) of the Road Traffic Act 1988 (c. 52).

60Exemption for works bus services: extension to minibuses

(1)Section 197AA of the Taxes Act 1988 (works bus services: exemption from charge on benefits) is amended as follows.

(2)In subsection (1) (which confers the exemption), after “section 154 (taxable benefits: general charging provision)” insert “, or under section 157 (charge on provision of car for private use),”.

(3)In subsection (2) (meaning of works bus service), after “by means of a bus” insert “, or a minibus,”.

(4)In subsection (3) after the definition of “bus” insert—

“minibus” means a vehicle constructed or adapted for the carriage of passengers which has a seating capacity of 9 or more, but less than 12;.

(5)In subsection (6) after “154” insert “or 157”.

(6)After subsection (8) (determination of seating capacity) insert—

(9)In determining whether a vehicle is a minibus for the purposes of this section, no account shall be taken of seats in relation to which relevant construction and use requirements are not met.

In this subsection “construction and use requirements” has the same meaning as in Part 2 of the Road Traffic Act 1988 or, in Northern Ireland, Part III of the Road Traffic (Northern Ireland) Order 1995..

(7)This section has effect for the year 2002-03 and subsequent years of assessment.

61Employee share ownership plans

The provisions relating to employee share ownership plans are amended in accordance with Schedule 13 to this Act.

Enterprise incentives

62Enterprise management incentives

Schedule 14 to this Act (which amends Schedule 14 to the Finance Act 2000 (c. 17) (enterprise management incentives)) has effect.

63Enterprise investment scheme

Schedule 15 to this Act (which makes amendments relating to the enterprise investment scheme) has effect.

64Venture capital

(1)Schedule 16 to this Act has effect.

(2)In that Schedule—

  • Part 1 makes amendments relating to venture capital trusts; and

  • Part 2 makes amendments relating to the corporate venturing scheme.

Capital allowances

65Energy-saving plant and machinery

Schedule 17 to this Act (first-year allowances in respect of expenditure on energy-saving plant and machinery) has effect—

(a)for income tax purposes, as respects allowances and charges falling to be made for chargeable periods ending on or after 6th April 2001, and

(b)for corporation tax purposes, as respects allowances and charges falling to be made for chargeable periods ending on or after 1st April 2001.

66Fixtures provided in connection with energy management services

(1)Schedule 18 to this Act (fixtures provided in connection with provision of energy management services) has effect in relation to expenditure incurred on or after 1st April 2001.

(2)The Schedule has effect—

(a)for income tax purposes, as respects allowances and charges falling to be made for chargeable periods ending on or after 6th April 2001, and

(b)for corporation tax purposes, as respects allowances and charges falling to be made for chargeable periods ending on or after 1st April 2001.

67Conversion of parts of business premises into flats

Schedule 19 to this Act (capital allowances in respect of expenditure on the conversion of parts of business premises into flats) has effect in relation to expenditure incurred on or after the day on which this Act is passed.

68Decommissioning of offshore oil infrastructure

Schedule 20 to this Act (capital allowances in respect of expenditure incurred on decommissioning offshore infrastructure) has effect.

69Minor amendments

(1)Schedule 21 (which makes minor amendments to the Capital Allowances Act 2001 (c. 2) ) has effect.

(2)The amendments made by the Schedule have effect—

(a)for income tax purposes, as respects allowances and charges falling to be made for chargeable periods ending on or after 6th April 2001, and

(b)for corporation tax purposes, as respects allowances and charges falling to be made for chargeable periods ending on or after 1st April 2001.

Other relieving provisions

70Relief for expenditure on remediation of contaminated land

(1)Schedule 22 to this Act (tax relief for expenditure on land remediation) has effect for accounting periods ending on or after 1st April 2001.

(2)In that Schedule—

  • Part 1 provides for a deduction for certain capital expenditure in computing the profits of a Schedule A business or the profits of a trade for the purposes of Case I of Schedule D,

  • Part 2 provides for entitlement to relief,

  • Part 3 provides for the manner of giving effect to the relief,

  • Part 4 makes special provision for companies carrying on life assurance business, and

  • Part 5 contains supplementary provisions.

(3)Schedule 23 to this Act (which contains consequential amendments) has effect accordingly.

71Creative artists: relief for fluctuating profits

(1)In Chapter 5 of Part 4 of the Taxes Act 1988 (computational provisions relating to the Schedule D charge), before section 96 and after the cross-heading “Special provisions” insert—

95ACreative artists: relief for fluctuating profits

Schedule 4A (which enables individuals to make an averaging claim in respect of profits derived wholly or mainly from creative works) shall have effect.

The provisions of that Schedule apply for the year 2000-01 and subsequent years of assessment (so that the first years which may be the subject of an averaging claim are 2000-01 and 2001-02)..

(2)After Schedule 4 to that Act insert the Schedule 4A set out in Part 1 of Schedule 24 to this Act.

(3)The following provisions of the Taxes Act 1988 are repealed—

  • section 534 (relief for copyright payments etc.);

  • section 535 (relief where copyright sold after ten years or more);

  • section 537A (relief for payments in respect of designs);

  • section 538 (relief for painters, sculptors and other artists).

The repeals have effect in relation to payments actually receivable on or after 6th April 2001.

(4)Part 2 of Schedule 24 to this Act contains amendments consequential on the preceding provisions of this section.

72Expenditure on film production etc

In section 48(2)(a) of the Finance (No.2) Act 1997 (c. 58) (favourable tax treatment for certain expenditure on film production, etc. incurred before 2nd July 2002) for “2nd July 2002” substitute “2nd July 2005”.

73Deductions for business gifts: yearly limit

(1)Section 577 of the Taxes Act 1988 (prohibition on deduction of expenses in providing business entertainment or gifts) is amended as follows.

(2)In subsection (8)(b) (under which gifts not amounting to more than £10 in any year are disregarded)—

(a)for “year” substitute “relevant tax period”, and

(b)for “£10” substitute “£50”.

(3)After that subsection insert—

(8A)In subsection (8)(b) “relevant tax period” means—

(a)for the purposes of corporation tax, an accounting period;

(b)for the purposes of income tax—

(i)for a year of assessment in relation to which sections 60 to 63 apply and give a basis period, that basis period;

(ii)in any other case, a year of assessment..

(4)This section applies in relation to the year 2001-02 and subsequent years of assessment or, in the case of companies, in relation to accounting periods beginning on or after 1st April 2001.

Pension funds

74Payments to employers out of pension funds

(1)Section 601 of the Taxes Act 1988 (charge on payment to employer out of funds held for purposes of exempt approved scheme) is amended as follows.

(2)In subsection (2) (amount recoverable by Board from employer) for “40 per cent. of the payment” substitute “the relevant percentage of the payment”.

(3)After that subsection insert—

(2A)The relevant percentage is 35% or such other percentage (whether higher or lower) as may be prescribed..

(4)This section applies to payments made to employers after the passing of this Act.

Limited liability partnerships

75Limited liability partnerships: general

(1)For section 118ZA of the Taxes Act 1988 (treatment of limited liability partnerships) substitute—

118ZATreatment of limited liability partnerships

(1)For the purposes of the Tax Acts, where a limited liability partnership carries on a trade, profession or other business with a view to profit—

(a)all the activities of the partnership are treated as carried on in partnership by its members (and not by the partnership as such),

(b)anything done by, to or in relation to the partnership for the purposes of, or in connection with, any of its activities is treated as done by, to or in relation to the members as partners, and

(c)the property of the partnership is treated as held by the members as partnership property.

References in this subsection to the activities of the limited liability partnership are to anything that it does, whether or not in the course of carrying on a trade, profession or other business with a view to profit.

(2)For all purposes, except as otherwise provided, in the Tax Acts—

(a)references to a partnership include a limited liability partnership in relation to which subsection (1) above applies,

(b)references to members of a partnership include members of such a limited liability partnership,

(c)references to a company do not include such a limited liability partnership, and

(d)references to members of a company do not include members of such a limited liability partnership.

(3)Subsection (1) above continues to apply in relation to a limited liability partnership which no longer carries on any trade, profession or other business with a view to profit—

(a)if the cessation is only temporary, or

(b)during a period of winding up following a permanent cessation, provided—

(i)the winding up is not for reasons connected in whole or in part with the avoidance of tax, and

(ii)the period of winding up is not unreasonably prolonged,

but subject to subsection (4) below.

(4)Subsection (1) above ceases to apply in relation to a limited liability partnership—

(a)on the appointment of a liquidator or (if earlier) the making of a winding-up order by the court, or

(b)on the occurrence of any event under the law of a country or territory outside the United Kingdom corresponding to an event specified in paragraph (a) above.

(2)In the Taxation of Chargeable Gains Act 1992 (c. 12), for section 59A (limited liability partnerships) substitute—

59ALimited liability partnerships

(1)Where a limited liability partnership carries on a trade or business with a view to profit—

(a)assets held by the limited liability partnership are treated for the purposes of tax in respect of chargeable gains as held by its members as partners, and

(b)any dealings by the limited liability partnership are treated for those purposes as dealings by its members in partnership (and not by the limited liability partnership as such);

and tax in respect of chargeable gains accruing to the members of the limited liability partnership on the disposal of any of its assets shall be assessed and charged on them separately.

(2)For all purposes, except as otherwise provided, in the enactments relating to tax in respect of chargeable gains—

(a)references to a partnership include a limited liability partnership in relation to which subsection (1) above applies,

(b)references to members of a partnership include members of such a limited liability partnership,

(c)references to a company do not include such a limited liability partnership, and

(d)references to members of a company do not include members of such a limited liability partnership.

(3)Subsection (1) above continues to apply in relation to a limited liability partnership which no longer carries on any trade or business with a view to profit—

(a)if the cessation is only temporary, or

(b)during a period of winding up following a permanent cessation, provided—

(i)the winding up is not for reasons connected in whole or in part with the avoidance of tax, and

(ii)the period of winding up is not unreasonably prolonged,

but subject to subsection (4) below.

(4)Subsection (1) above ceases to apply in relation to a limited liability partnership—

(a)on the appointment of a liquidator or (if earlier) the making of a winding-up order by the court, or

(b)on the occurrence of any event under the law of a country or territory outside the United Kingdom corresponding to an event specified in paragraph (a) above.

(5)Where subsection (1) above ceases to apply in relation to a limited liability partnership with the effect that tax is assessed and charged—

(a)on the limited liability partnership (as a company) in respect of chargeable gains accruing on the disposal of any of its assets, and

(b)on the members in respect of chargeable gains accruing on the disposal of any of their capital interests in the limited liability partnership,

it shall be assessed and charged on the limited liability partnership as if subsection (1) above had never applied in relation to it.

(6)Neither the commencement of the application of subsection (1) above nor the cessation of its application in relation to a limited liability partnership shall be taken as giving rise to the disposal of any assets by it or any of its members..

(3)In Chapter 2 of Part 5 of the Taxation of Chargeable Gains Act 1992 (c. 12) (relief for gifts of business assets), after section 169 insert—

169ACessation of trade by limited liability partnership

(1)This section applies where section 59A(1) ceases to apply to a limited liability partnership.

(2)A member of the partnership who immediately before the time at which section 59A(1) ceases to apply holds an asset, or an interest in an asset, acquired by him—

(a)on a disposal to members of a partnership, and

(b)for a consideration which is treated as reduced under section 165(4)(b) or 260(3)(b),

shall be treated as if a chargeable gain equal to the amount of the reduction accrued to him immediately before that time.

(4)In section 170(9) of the Taxation of Chargeable Gains Act 1992 (groups of companies: meaning of “company”), in paragraph (b) after “company” insert “(other than a limited liability partnership)”.

(5)Subsection (3) above shall be deemed to have come into force on 3rd May 2001 and applies where section 59A(1) of the Taxation of Chargeable Gains Act 1992 ceased or ceases to apply as mentioned in section 169A of that Act (as inserted by that subsection) on or after that date.

(6)The other provisions of this section shall be deemed to have come into force on 6th April 2001.

76Limited liability partnerships: investment LLPs and property investment LLPs

(1)Schedule 25 to this Act has effect with respect to limited liability partnerships whose business consists wholly or mainly in the making of investments.

(2)The provisions of that Schedule shall be deemed to have come into force on 6th April 2001.

Chargeable gains

77Notional transfers within a group

(1)Section 171A of the Taxation of Chargeable Gains Act 1992 (notional transfers within a group) shall be deemed to have been enacted with the following amendments.

(2)In subsection (2) (corporation tax consequences of election for asset disposed of by member A of a group to be treated as if, immediately before the disposal, it had been transferred to member B of the group) omit the word “and” immediately preceding paragraph (c) and at the end of that paragraph add— ; and

(d)any incidental costs to A of making the actual disposal to C shall be deemed to be incidental costs to B of making the deemed disposal to C..

(3)In subsection (4) (election to be made before second anniversary of end of accounting period of A in which disposal made) for “before” substitute “on or before”.

78Taper relief: assets qualifying as business assets

(1)Schedule A1 to the Taxation of Chargeable Gains Act 1992 (c. 12) (application of taper relief) shall have effect with the amendments specified in Schedule 26 to this Act.

(2)Those amendments shall have effect, and be deemed always to have had effect, as if they had been included among the amendments made by section 67 of the Finance Act 2000 (c. 17).

79De-grouping charge: transitional relief

Schedule 29 to the Finance Act 2000 (chargeable gains: non-resident companies and groups etc) shall be deemed to have been enacted with the following paragraph added at the end of Part 3 (transitional provisions) after paragraph 46—

De-grouping charge: deferral until company leaves new group

47(1)This paragraph has effect for the purposes of section 179 of the Taxation of Chargeable Gains Act 1992 as that section has effect in relation to assets acquired before 1st April 2000 (“old section 179”).

(2)Where—

(a)a company would (apart from this paragraph) fall to be regarded for the purposes of old section 179 as ceasing to be a member of an old group at any time, but

(b)immediately before that time, it is also a member of a new group for the purposes of new section 179,

the company shall not be regarded for the purposes of old section 179 as ceasing to be a member of the old group unless or until it also ceases to be a member of the new group for the purposes of new section 179.

(3)Sub-paragraph (2) above does not prevent the company from being or becoming a member of another old group at any time.

(4)Where a company ceases to be a member of a new group on any occasion, it shall not by virtue of sub-paragraph (2) above be treated for the purposes of old section 179 as if it had on that occasion ceased to be a member of the same old group more than once.

(5)For the purposes of this paragraph—

(a)references to a company being a member of an old group are references to its being, for the purposes of old section 179, a member of a group of companies within the meaning given by old section 170;

(b)references to a company being a member of a new group are references to its being, for the purposes of new section 179, a member of a group of companies within the meaning given by new section 170; and

(c)references to a company ceasing to be a member of an old group or a new group shall be construed in accordance with paragraph (a) or (b) above, as the case may be.

(6)Where, for the purposes of sub-paragraph (2)(b) above, a company is not a member of a new group by reason only that—

(a)the principal company of the old group is not the principal company of the new group, and

(b)the company in question is not an effective 51 per cent subsidiary of the principal company of the new group,

subsection (3)(b) of new section 170 shall not apply in relation to the company for the purposes of this paragraph for so long as it remains an effective 51 per cent subsidiary of the company which was the principal company of the old group.

(7)In this paragraph—

(a)“new section 179” means section 179 of the Taxation of Chargeable Gains Act 1992 (c. 12) as it has effect in relation to assets acquired on or after 1st April 2000;

(b)“new section 170” means section 170 of that Act, as amended by the main amendments;

(c)“old section 170” means section 170 of the Taxation of Chargeable Gains Act 1992, as it stands before the main amendments.

(8)Expressions used in this paragraph and in section 170 of the Taxation of Chargeable Gains Act 1992 shall be construed in accordance with that section..

80Attribution of gains of non-resident companies

(1)Section 13 of the Taxation of Chargeable Gains Act 1992 (attribution of gains to members of non-resident companies) is amended as follows.

(2)In subsection (4) (no attribution if amount does not exceed one twentieth of gain) for “one twentieth” substitute “one tenth”.

(3)In subsection (5) (gains to which the section does not apply) for paragraph (b) substitute—

(b)a chargeable gain accruing on the disposal of an asset used, and used only—

(i)for the purposes of a trade carried on by the company wholly outside the United Kingdom, or

(ii)for the purposes of the part carried on outside the United Kingdom of a trade carried on by the company partly within and partly outside the United Kingdom,.

(4)For subsection (5A) (credit for tax on attributed gain in relation to later distribution) substitute—

(5A)Where—

(a)an amount of tax is paid by a person in pursuance of subsection (2) above, and

(b)an amount in respect of the chargeable gain is distributed (either by way of dividend or distribution of capital or on the dissolution of the company) before the end of the period specified in subsection (5B) below,

the amount of tax (so far as neither reimbursed by the company nor applied as a deduction under subsection (7) below) shall be applied for reducing or extinguishing any liability of that person to income tax, capital gains tax or corporation tax in respect of the distribution.

(5B)The period referred to in subsection (5A)(b) above is the period of three years from—

(a)the end of the period of account of the company in which the chargeable gain accrued, or

(b)the end of the period of twelve months beginning with the date on which the chargeable gain accrued,

whichever is earlier.

In paragraph (a) above a “period of account” means a period for which the company makes up its accounts.

(5)After subsection (10A) insert—

(10B)A chargeable gain that would be treated as accruing to a person under subsection (2) above shall not be so treated if—

(a)it would be so treated only if assets that are assets of a pension scheme were taken into account in ascertaining that person’s interest as a participator in the company, and

(b)at the time the gain accrues a gain arising on a disposal of those assets would be exempt from tax by virtue of section 271(1)(b), (c), (d), (g) or (h) or (2).

In paragraph (a) above “assets of a pension scheme” means assets held for the purposes of a fund or scheme to which any of the provisions mentioned in paragraph (b) above applies..

(6)This section applies to chargeable gains accruing as mentioned in section 13(1) of the Taxation of Chargeable Gains Act 1992 (c. 12) on or after 7th March 2001.

International matters

81Double taxation relief

Schedule 27 to this Act (double taxation relief) has effect.

82Controlled foreign companies: acceptable distribution policy

(1)Part 1 of Schedule 25 to the Taxes Act 1988 (acceptable distribution policy) is amended as follows.

(2)In paragraph 2 (meaning of acceptable distribution policy) at the end of sub-paragraph (1A) (requirement that payment of dividend is taken into account in computing corporation tax) add— and—

(a)it is chargeable neither under Case I of Schedule D nor under Case VI of that Schedule in circumstances where by virtue of section 436, 439B or 441 profits are computed in accordance with the provisions of this Act applicable to Case I; or

(b)if it is chargeable under Case I, or under Case VI in the circumstances described in paragraph (a) above, it is not involved in a UK tax avoidance scheme;

and paragraph 2B below has effect for the purposes of paragraph (b) above.

(3)After paragraph 2A insert—

2B(1)This paragraph has effect for the purposes of paragraph 2(1A)(b) above.

(2)No payment of dividend by a controlled foreign company for an accounting period shall be regarded as involved in a UK tax avoidance scheme by reason only that there is no charge to tax under section 747(4)(a) if the controlled foreign company pursues an acceptable distribution policy for that accounting period.

(3)“UK tax avoidance scheme” means a scheme or arrangement the purpose, or one of the main purposes, of which is to achieve a reduction in United Kingdom tax.

(4)A scheme or arrangement achieves a reduction in United Kingdom tax if, apart from the scheme or arrangement, any company—

(a)would have been liable for any such tax or for a greater amount of any such tax; or

(b)would not have been entitled to a relief from or repayment of any such tax or would have been entitled to a smaller relief from or repayment of any such tax.

(5)In this paragraph—

  • “arrangement” means an arrangement of any kind, whether in writing or not;

  • “United Kingdom tax” means corporation tax or any tax chargeable as if it were corporation tax..

(4)In paragraph 4 (controlled foreign company dividends passing up a chain of related companies) at the end of sub-paragraph (1) (which provides for a payment made by a controlled foreign company to be regarded as made to a United Kingdom resident) add “and shall be taken to satisfy the conditions in paragraph 2(1A) above”.

(5)At the end of sub-paragraph (1A) of that paragraph (requirement that the subsequent dividend is taken into account in computing corporation tax) add— and—

(a)it is chargeable neither under Case I of Schedule D nor under Case VI of that Schedule in circumstances where by virtue of section 436, 439B or 441 profits are computed in accordance with the provisions of this Act applicable to Case I; or

(b)if it is chargeable under Case I, or under Case VI in the circumstances described in paragraph (a) above, it is not involved in a UK tax avoidance scheme;

and paragraph 4A below has effect for the purposes of paragraph (b) above..

(6)In sub-paragraph (2) of that paragraph (interpretation) after “one company is related to another if” insert “neither is resident in the United Kingdom and”.

(7)After paragraph 4 insert—

4A(1)This paragraph has effect for the purposes of paragraph 4(1A)(b) above.

(2)No payment to a company resident in the United Kingdom which represents the whole or part of a dividend paid by a controlled foreign company for an accounting period shall be regarded as involved in a UK tax avoidance scheme by reason only that—

(a)there is no charge to tax under section 747(4)(a) if the controlled foreign company pursues an acceptable distribution policy for that accounting period, and

(b)so much of the dividend as is represented by that payment will (if paragraph 4(1) above has effect) fall to be brought into account in determining whether the controlled foreign company has done so.

(3)“UK tax avoidance scheme” means a scheme or arrangement the purpose, or one of the main purposes, of which is to achieve a reduction in United Kingdom tax.

(4)A scheme or arrangement achieves a reduction in United Kingdom tax if, apart from the scheme or arrangement, any company—

(a)would have been liable for any such tax or for a greater amount of any such tax; or

(b)would not have been entitled to a relief from or repayment of any such tax or would have been entitled to a smaller relief from or repayment of any such tax.

(5)In this paragraph—

  • “arrangement” means an arrangement of any kind, whether in writing or not;

  • “United Kingdom tax” means corporation tax or any tax chargeable as if it were corporation tax.

(8)This section applies to dividends paid on or after 7th March 2001 by a controlled foreign company for any accounting period of that controlled foreign company which ends on or after that date.

(9)In this section “accounting period” and “controlled foreign company” have the same meaning as they have in Chapter 4 of Part 17 of the Taxes Act 1988.

Miscellaneous

83Life policies, life annuity contracts and capital redemption policies

(1)Schedule 28 to this Act (which makes amendments relating to Chapter 2 of Part 13 of the Taxes Act 1988) has effect.

(2)The amendments made by Part 1 of that Schedule (which relate to the assignment or surrender of part of, or a share in, the rights conferred by a policy or contract) have effect, in the case of any policy or contract, in relation to any year (within the meaning given by section 546(4) of the Taxes Act 1988) beginning on or after 6th April 2001.

(3)The amendments made by Part 2 of that Schedule (which relate to the provision by insurers etc of information relating to chargeable events happening in connection with a policy or contract) have effect in relation to chargeable events happening on or after 6th April 2002.

84Exclusion of deductions for deemed manufactured payments

(1)Section 736B of the Taxes Act 1988 (deemed manufactured payments in case of stock lending arrangements) is amended as follows.

(2)In subsection (2) (application of provisions to deemed manufactured payments) after “shall apply” insert “, subject to subsection (2A) below,”.

(3)After that subsection insert—

(2A)The borrower is not entitled, by virtue of anything in Schedule 23A or any provision of regulations under that Schedule, or otherwise—

(a)to any deduction in computing profits or gains for the purposes of income tax or corporation tax, or

(b)to any deduction against total income or, as the case may be, total profits,

in respect of any such deemed requirement or payment as is provided for by subsection (2) above.

Where the borrower is a company, an amount may not be surrendered by way of group relief if a deduction in respect of it is prohibited by this subsection.

(4)This section applies to payments treated under section 736B as made on or after 3rd October 2000.

85Deduction of tax: payments between companies etc

(1)After section 349 of the Taxes Act 1988 (certain payments to be made under deduction of tax) insert—

349AExceptions to section 349 for payments between companies etc

(1)The provisions specified in subsection (3) below (which require tax to be deducted on making certain payments) do not apply to a payment made by a company if, at the time the payment is made, the company reasonably believes that one of the conditions specified in section 349B is satisfied.

(2)Subsection (1) above has effect subject to any directions under section 349C.

(3)The provisions are—

  • section 349(1) (certain annuities and other annual payments, and royalties and other sums paid for use of UK patents),

  • section 349(2)(a) and (b) (UK interest),

  • section 349(3A) (dividend or interest on securities issued by building societies), and

  • section 524(3)(b) (which provides for section 349(1) to apply to proceeds of sale of UK patent rights).

(4)References in subsection (3) above to any provision of section 349 do not include that provision as applied—

(a)under section 777(9) (directions applying section 349(1) to certain payments to non-residents), or

(b)by paragraph 4(2) of Schedule 23A (manufactured overseas dividends to be treated as annual payments within section 349).

(5)References in this section to the company by which a payment is made do not include a company acting as trustee or agent for another person.

(6)For the purposes of this section, a payment by a partnership is treated as made by a company if any member of the partnership is a company.

349BThe conditions mentioned in section 349A(1)

(1)The first of the conditions mentioned in section 349A(1) is that the person beneficially entitled to the income in respect of which the payment is made is—

(a)a company resident in the United Kingdom, or

(b)a partnership each member of which is a company resident in the United Kingdom.

(2)The second of those conditions is that—

(a)the person beneficially entitled to the income in respect of which the payment is made is a company not resident in the United Kingdom (“the non-resident company”),

(b)the non-resident company carries on a trade in the United Kingdom through a branch or agency, and

(c)the payment falls to be brought into account in computing the chargeable profits (within the meaning given by section 11(2)) of the non-resident company.

349CDirections disapplying section 349A(1)

(1)The Board may give a direction to a company directing that section 349A(1) is not to apply in relation to any payment that—

(a)is made by the company after the giving of the direction, and

(b)is specified in the direction or is of a description so specified.

(2)Such a direction shall not be given unless the Board have reasonable grounds for believing as respects each payment to which the direction relates that it is likely that neither of the conditions specified in section 349B will be satisfied in relation to the payment at the time the payment is made.

(3)A direction under this section may be varied or revoked by a subsequent such direction.

(4)In this section “company” includes a partnership of which any member is a company.

349DSection 349A(1): consequences of reasonable but incorrect belief

(1)Where—

(a)a payment is made by a company without an amount representing the income tax on the payment being deducted from the payment,

(b)at the time the payment is made, the company reasonably believes that one of the conditions specified in section 349B is satisfied,

(c)if the company did not so believe, tax would be deductible from the payment under section 349, and

(d)neither of the conditions specified in section 349B is satisfied at the time the payment is made,

section 350 applies as if the payment were within section 349 (and Schedule 16 applies as if tax were deductible from the payment under section 349).

(2)In this section “company” includes a partnership of which any member is a company..

(2)In section 98 of the Taxes Management Act 1970 (c. 9) (penalties for failing to make, or making incorrectly, certain returns etc.), after subsection (4) insert—

(4A)If—

(a)a failure to comply with section 350(1) of, or Schedule 16 to, the principal Act arises from a person’s failure to deliver an account, or show the amount, of a payment, and

(b)the payment is within subsection (4B) below,

subsection (1) above shall have effect as if for “£300” there were substituted “£3,000” and as if for “£60” there were substituted “£600”.

(4B)A payment is within this subsection if—

(a)the payment is made by a company without an amount representing the income tax on the payment being deducted from the payment,

(b)at the time the payment is made, the company—

(i)does not believe that either of the conditions specified in section 349B of the principal Act is satisfied, or

(ii)where it believes that either of those conditions is satisfied, could not reasonably so believe,

(c)the payment is one from which tax is deductible under section 349 of the principal Act unless the company reasonably believes that one of those conditions is satisfied, and

(d)neither of those conditions is satisfied at the time the payment is made.

(4C)In subsection (4B) above “company” includes a partnership of which any member is a company..

(3)In section 338(4) of the Taxes Act 1988 (when payment by company to non-resident to be treated as charge on income), after paragraph (a) insert—

(aa)the person beneficially entitled to the income in respect of which the payment is made is a company not resident in the United Kingdom (“the non-resident company”), the non-resident company carries on a trade in the United Kingdom through a branch or agency and the payment falls to be brought into account in computing the chargeable profits (within the meaning given by section 11(2)) of the non-resident company, or.

(4)Subsections (1) to (3) apply to payments made on or after 1st April 2001.

(5)Sections 247 and 248 of the Taxes Act 1988 (companies within a group may elect for section 349 not to apply to payments between them) shall cease to have effect.

(6)Subsection (5) applies in relation to payments made after the day on which this Act is passed.

86Profits for purposes of small companies' relief

(1)Section 13 of the Taxes Act 1988 (small companies' relief) is amended in accordance with subsections (2) to (4).

(2)In subsection (7) (profits of company for accounting period)—

(a)in paragraph (a), omit “resident in the United Kingdom”, and

(b)in paragraph (b), for “section 247(1A)” substitute “subsection (7A) below”.

(3)After subsection (7) insert—

(7A)A company falls within this subsection if—

(a)it is a 75 per cent subsidiary of any other company, or

(b)arrangements of any kind (whether in writing or not) are in existence by virtue of which it could become such a subsidiary..

(4)For subsection (8AA) (interpretation of subsection (7)) substitute—

(8AA)Section 13ZA applies for the interpretation of subsection (7) above..

(5)After section 13 of the Taxes Act 1988 insert—

13ZAInterpretation of section 13(7)

(1)In determining for the purposes of section 13(7) whether one body corporate is a 51 per cent subsidiary of another, that other shall be treated as not being the owner of any share capital—

(a)which it owns indirectly, and

(b)which is owned directly by a body corporate for which a profit on the sale of the shares would be a trading receipt.

(2)Notwithstanding that at any time a company (“the subsidiary company”) is a 51 per cent subsidiary of another company (“the parent company”) it shall not be treated at that time as such a subsidiary for the purposes of section 13(7) unless, additionally, at that time—

(a)the parent company would be beneficially entitled to more than 50 per cent of any profits available for distribution to equity holders of the subsidiary company, and

(b)the parent company would be beneficially entitled to more than 50 per cent of any assets of the subsidiary company available for distribution to its equity holders on a winding-up.

(3)For the purposes of section 13(7) and this section—

(a)“trading or holding company” means a trading company or a company the business of which consists wholly or mainly in the holding of shares or securities of trading companies that are its 90 per cent subsidiaries;

(b)“trading company” means a company whose business consists wholly or mainly of the carrying on of a trade or trades;

(c)a company is owned by a consortium if 75 per cent or more of the ordinary share capital of the company is beneficially owned between them by companies of which none—

(i)beneficially owns less than 5 per cent of that capital,

(ii)would be beneficially entitled to less than 5 per cent of any profits available for distribution to equity holders of the company, or

(iii)would be beneficially entitled to less than 5 per cent of any assets of the company available for distribution to its equity holders on a winding up,

and those companies are called the members of the consortium.

(4)Schedule 18 (equity holders and assets etc. available for distribution) applies for the purposes of subsections (2) and (3)(c) above as it applies for the purposes of section 413(7).

(6)The amendments made by this section apply for the purposes of accounting periods ending on or after 1st April 2001.

87Tax deductions and credits: end of provisional repayment regime

(1)The provisions of section 438A of, and Schedule 19AB to, the Taxes Act 1988 (provisional repayments in respect of tax borne by deduction and tax credits) shall cease to have effect as follows.

(2)Those provisions shall not apply in relation to income tax borne by deduction from payments received after 30th September 2001.

(3)For the purposes of the following provisions (as they apply in relation to tax credits)—

(a)section 121 of the Finance Act 1993 (c. 34) (application of Schedule 19AB to tax exempt business of friendly societies) and any regulations under that section, and

(b)any regulations under section 333B of the Taxes Act 1988 (individual savings account business etc. of insurance companies and friendly societies),

that Schedule shall be deemed to continue to apply in relation to pension business of insurance companies as it would do so apart from subsection (2).

(4)The power to make regulations under each of the sections referred to in subsection (3) includes power to set out the text of that Schedule as applied by regulations under that section.

(5)The provisions of section 438A of, and Schedule 19AB to, the Taxes Act 1988 shall not apply in relation to tax credits in respect of distributions made on or after 6th April 2004.

General

88Amendments to the machinery of self-assessment

(1)Schedule 29 to this Act (amendments to the machinery of self-assessment) has effect.

(2)In that Schedule—

  • Part 1 makes provision about the amendment or correction of returns,

  • Part 2 makes provision about enquiries into returns,

  • Part 3 makes provision for the referral of questions to the Special Commissioners during an enquiry,

  • Part 4 makes provision about the procedure on completion of an enquiry, and

  • Part 5 contains minor and consequential amendments.

(3)Except as otherwise provided, the amendments in that Schedule have effect as from the passing of this Act in relation to returns—

(a)whether made before or after the passing of this Act, and

(b)whether relating to periods before or after the passing of this Act.

89Recovery proceedings: minor amendments

(1)In sections 66(1) and 67(1) of the Taxes Management Act 1970 (c. 9) (proceedings in county court or sheriff court to recover tax due and payable under an assessment), omit the words “under any assessment”.

This amendment applies in relation to proceedings begun after the passing of this Act.

(2)For section 69 of the Taxes Management Act 1970 substitute—

69Recovery of penalty, surcharge or interest

(1)This section applies to—

(a)penalties imposed under Part 2, 5A or 10 of this Act or Schedule 18 to the Finance Act 1998;

(b)surcharges imposed under Part 5A of this Act; and

(c)interest charged under any provision of this Act (or recoverable as if it were interest so charged).

(2)An amount by way of penalty, surcharge or interest to which this section applies shall be treated for the purposes of the following provisions as if it were an amount of tax.

(3)Those provisions are—

(a)sections 61, 63 and 65 to 68 of this Act;

(b)section 35(2)(g)(i) of the Crown Proceedings Act 1947 (rules of court: restriction of set-off or counterclaim where proceedings, or set-off or counterclaim, relate to tax) and any rules of court imposing any such restriction;

(c)section 35(2)(b) of that Act as set out in section 50 of that Act (which imposes corresponding restrictions in Scotland).

This amendment applies—

(a)to proceedings begun (or a counterclaim made) after the passing of this Act, and

(b)to a set-off first claimed after the passing of this Act.

(3)In section 70 of the Taxes Management Act 1970 (c. 9) (evidence), in subsection (2)(a) (certificate of collector as to penalty, surcharge or interest payable), for “payable under Part 9 of this Act” substitute “payable under any provision of this Act or the principal Act”.

This amendment applies to certificates tendered in evidence after the passing of this Act.

90Repayment supplements: claim for relief involving two or more years

(1)Section 824 of the Taxes Act 1988 (repayment supplements) is amended as follows.

(2)After subsection (2B) insert—

(2C)Subsection (1) above shall apply to a repayment made by the Board as a result of a claim for relief under—

(a)paragraph 2 of Schedule 1B to the Management Act (carry back of loss relief),

(b)paragraph 3 of that Schedule (relief for fluctuating profits of farming etc.), or

(c)Schedule 4A to this Act (relief for fluctuating profits of creative artists etc.),

as if it were a repayment falling within that subsection..

(3)In subsection (3), after paragraph (aa) insert—

(ab)if the repayment is a repayment as a result of a claim for relief under any of the provisions mentioned in subsection (2C) above, the relevant time is the 31st January next following the year that is the later year in relation to the claim;.

(4)This section applies in relation to repayments made after the passing of this Act.

91Power to revise excessive penalties

(1)In section 100 of the Taxes Management Act 1970 (determination of penalties by officer of the Board), in subsection (6) (revision of penalty if amount of tax taken into account discovered to be excessive), after “a penalty under” insert “section 93(2), (4) or (5) of this Act or”.

(2)This section applies in relation to penalties determined at any time whether before or after the passing of this Act.

Part 4Other taxes

Stamp duty and stamp duty reserve tax

92Stamp duty: exemption for land in disadvantaged areas

(1)No stamp duty shall be chargeable under Part 1 or 2, or paragraph 16 of Part 3, of Schedule 13 to the Finance Act 1999 (c. 16) on—

(a)a conveyance or transfer of an estate or interest in land, or

(b)a lease of land,

if the land is situated in a disadvantaged area.

(2)Where stamp duty would be chargeable on an instrument but for subsection (1), that subsection shall have effect in relation to the instrument only if the instrument is certified to the Commissioners as being an instrument on which stamp duty is by virtue of that subsection not chargeable.

(3)No instrument which is certified as mentioned in subsection (2) shall be taken to be duly stamped unless—

(a)it is stamped in accordance with section 12 of the Stamp Act 1891 (c. 39) with a particular stamp denoting that it is not chargeable with any duty or that it is duly stamped, or

(b)it is stamped with the duty to which it would have been liable but for this section.

(4)For the purposes of this section and Schedule 30 to this Act, a disadvantaged area is an area designated as such by regulations made by the Treasury; and any such regulations may—

(a)designate specified areas as disadvantaged areas, or

(b)provide for areas of a description specified in the regulations to be designated as disadvantaged areas.

(5)If regulations under subsection (4) so provide, the designation of an area as a disadvantaged area shall have effect for such period as may be specified by or determined in accordance with the regulations.

(6)Schedule 30 to this Act (which makes further provision about land in disadvantaged areas) shall have effect.

(7)This section and Schedule 30 to this Act shall be construed as one with the Stamp Act 1891.

(8)The provisions of this section and Schedule 30 to this Act shall have effect in relation to instruments executed on or after such date as may be specified by order made by the Treasury.

(9)Regulations under subsection (4)—

(a)may make different provision for different cases, and

(b)may contain such incidental, supplementary, consequential or transitional provision as appears to the Treasury to be necessary or expedient.

(10)The power to make regulations under subsection (4) shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons.

(11)The power to make an order under subsection (8) shall be exercisable by statutory instrument.

93SDRT: unit trust schemes and individual pension accounts

(1)Schedule 19 to the Finance Act 1999 (c. 16) (which abolishes charges to stamp duty, and introduces a charge to stamp duty reserve tax, in relation to units under a unit trust scheme) is amended as follows.

(2)In paragraph 2(4) (charge to be subject to exclusions provided in paragraphs 6 and 7) after “6” insert “, 6A”.

(3)In paragraph 4 (proportionate reduction of tax by reference to units issued) at the end insert—

(6)If a certificate is given in accordance with paragraph 6A(1)(c) in respect of a period which includes the relevant two-week period in the case of the unit in question in sub-paragraph (1), there shall be left out of account in applying this paragraph in relation to that unit—

(a)any issue of a unit which is to be held within an individual pension account, and

(b)any surrender of a unit which, immediately before the surrender, was held within an individual pension account.

(7)“Individual pension account” has the same meaning in sub-paragraph (6) as it has in paragraph 6A.

(4)After paragraph 6 insert—

Exclusion of charge in case of individual pension accounts

6A(1)There is no charge to tax under this Part of this Schedule on the surrender of the unit if—

(a)immediately before the surrender, the unit is held within an individual pension account,

(b)not all the units under the unit trust scheme are so held at that time, and

(c)a certificate pursuant to sub-paragraph (2) is contained in, or provided with, the relevant monthly tax return.

(2)The certificate must be given by the persons making the relevant monthly tax return and must state—

(a)that at all times in the period to which the return relates the trustees or managers were able to identify which of the units under the scheme were held within individual pension accounts, and

(b)that at no time in that period have the trustees or managers imposed any charge on, or recovered any amount from, an IPA unit holder which included an amount directly or indirectly attributable to tax payable by the trustees under this Part of this Schedule.

(3)In sub-paragraph (2), “IPA unit holder” means—

(a)a person acquiring, or who has acquired, a unit under the unit trust scheme, where the unit is to be held within an individual pension account,

(b)a person holding a unit under the scheme, where the unit is held within an individual pension account, or

(c)a person surrendering, or who has surrendered, a unit under the scheme, where immediately before the surrender the unit is or was held within an individual pension account.

(4)In this paragraph—

  • “individual pension account” has the same meaning as in regulations under section 638A of the Taxes Act 1988 (as at 6th April 2001, see regulation 4 of the Personal Pension Schemes (Restriction on Discretion to Approve) (Permitted Investments) Regulations 2001 (S.I. 2001/117)) ;

  • “the relevant monthly tax return”, in the case of any surrender, means the notice required by regulations under section 98 of the Finance Act 1986 (c. 41) to be given by the managers (or, failing that, the trustees) under the unit trust scheme to the Commissioners of Inland Revenue containing among other things details of all surrenders in the relevant two-week period;

  • “the relevant two-week period” has the meaning given by paragraph 4(2).

(5)The amendment made by subsection (3) has effect where the relevant two-week period mentioned in paragraph 4(1) of Schedule 19 to the Finance Act 1999 (c. 16) ends after 6th April 2001.

(6)The other amendments made by this section have effect in relation to surrenders made or effected on or after 6th April 2001.

94SDRT: open-ended investment companies and individual pension accounts

(1)Where there are two or more classes of shares in an open-ended investment company and the company’s instrument of incorporation—

(a)provides that shares of one or more of those classes (“the IPA classes”) may only be held within an individual pension account, and

(b)does not make such provision in relation to shares of at least one other class,

there is no charge to stamp duty reserve tax under Part 2 of Schedule 19 to the Finance Act 1999 (c. 16) on the surrender of a share of any of the IPA classes.

(2)References in this section to provisions of Schedule 19 to the Finance Act 1999 (c. 16) are references to those provisions as they have effect in relation to open-ended investment companies by virtue of regulations from time to time in force under section 152 of the Finance Act 1995 (c. 4)(as at 6th April 2001, see regulations 3 to 4B of the 1997 Regulations as amended by regulations 4 and 5 of the 1999 (No.2) Regulations).

(3)In this section—

  • “individual pension account” has the same meaning as it has in regulations from time to time in force under section 638A of the Taxes Act 1988 (as at 6th April 2001, see regulation 4 of the 2001 Regulations);

  • “open-ended investment company” has the meaning given by paragraph 14(2) of Schedule 19 to the Finance Act 1999 (c. 16);

  • “surrender”, in relation to a share in an open-ended investment company, has the same meaning as it has in Part 2 of Schedule 19 to the Finance Act 1999.

(4)For the purposes of subsections (2) and (3)—

(5)This section has effect in relation to surrenders made or effected on or after 6th April 2001.

95Exemptions in relation to employee share ownership plans

(1)Schedule 8 to the Finance Act 2000 (c. 17) (employee share ownership plans) is amended as follows.

(2)After paragraph 116 insert—

Exemptions from stamp duty and stamp duty reserve tax

116AWhere, under an approved employee share ownership plan, partnership shares or dividend shares are transferred by the trustees to an employee—

(a)no ad valorem stamp duty is chargeable on any instrument by which the transfer is made, and

(b)no stamp duty reserve tax is chargeable on any agreement by the trustees to make the transfer.

(3)This section has effect in relation to—

(a)instruments executed (within the meaning of the Stamp Act 1891 (c. 39)) after the day on which this Act is passed, and

(b)agreements to transfer shares made after the day on which this Act is passed.

Value added tax

96VAT: children’s car seats

(1)In paragraph 1 of Schedule A1 to the Value Added Tax Act 1994 (c. 23) (supplies benefiting from 5% reduced rate), after sub-paragraph (4) insert—

(5)The supplies falling within this paragraph also include supplies of children’s car seats.

(2)After paragraph 6 of that Schedule insert—

Interpretation of paragraph 1(5)

7(1)Paragraph 1(5) above is interpreted in accordance with the provisions of this paragraph.

(2)The following are “children’s car seats”—

(a)a safety seat;

(b)the combination of a safety seat and a related wheeled framework;

(c)a booster seat;

(d)a booster cushion.

(3)In this paragraph “safety seat” means a seat—

(a)designed to be sat in by a child in a road vehicle,

(b)designed so that, when in use in a road vehicle, it can be restrained—

(i)by a seat belt fitted in the vehicle, or

(ii)by belts, or anchorages, that form part of the seat being attached to the vehicle, or

(iii)in either of those ways, and

(c)incorporating an integral harness, or integral impact shield, for restraining a child seated in it.

(4)For the purposes of this paragraph, a wheeled framework is “related” to a safety seat if the framework and the seat are each designed so that—

(a)when the seat is not in use in a road vehicle it can be attached to the framework, and

(b)when the seat is so attached, the combination of the seat and the framework can be used as a child’s pushchair.

(5)In this paragraph “booster seat” means a seat designed—

(a)to be sat in by a child in a road vehicle, and

(b)so that, when in use in a road vehicle, it and a child seated in it can be restrained by a seat belt fitted in the vehicle.

(6)In this paragraph “booster cushion” means a cushion designed—

(a)to be sat on by a child in a road vehicle, and

(b)so that a child seated on it can be restrained by a seat belt fitted in the vehicle.

(7)In this paragraph “child” means a person aged under 14 years..

(3)The amendments made by this section have effect in relation to supplies made after the day on which this Act is passed.

97VAT: residential conversions and renovations

(1)In paragraph 1 of Schedule A1 to the Value Added Tax Act 1994 (c. 23) (supplies benefiting from 5% reduced rate), after sub-paragraph (5) (which is inserted by section 96 of this Act) insert—

(6)The supplies falling within this paragraph also include—

(a)the supply, in the course of a qualifying conversion, of qualifying services related to the conversion;

(b)the supply of building materials if—

(i)the materials are supplied by a person who, in the course of a qualifying conversion, is supplying qualifying services related to the conversion, and

(ii)those services include the incorporation of the materials in the building concerned or its immediate site.

(7)The supplies falling within this paragraph also include—

(a)the supply, in the course of the renovation or alteration of a single household dwelling, of qualifying services related to the renovation or alteration;

(b)the supply of building materials if—

(i)the materials are supplied by a person who, in the course of the renovation or alteration of a single household dwelling, is supplying qualifying services related to the renovation or alteration, and

(ii)those services include the incorporation of the materials in the dwelling concerned or its immediate site.

(8)Sub-paragraph (9) below applies where a supply of services is only in part a supply to which sub-paragraph (6)(a) or (7)(a) above applies.

(9)The supply, to the extent that it is one to which paragraph (a) of sub-paragraph (6) or (7) above applies, is to be taken to be a supply to which that paragraph applies; and an apportionment may be made to determine that extent.

(2)After paragraph 7 of that Schedule (which also is inserted by section 96 of this Act) insert—

Interpretation of paragraph 1(6): introductory

8(1)Paragraph 1(6) above is interpreted in accordance with paragraphs 9 to 17 and 22 below.

(2)In paragraphs 10 to 14 below, “single household dwelling” means a dwelling—

(a)that is designed for occupation by a single household, and

(b)in relation to which the conditions set out in sub-paragraph (4) below are satisfied.

(3)In paragraphs 10 to 14 below “multiple occupancy dwelling” means a dwelling—

(a)that is designed for occupation by persons not forming a single household, and

(b)in relation to which the conditions set out in sub-paragraph (4) below are satisfied.

(4)The conditions are—

(a)that the dwelling consists of self-contained living accommodation,

(b)that there is no provision for direct internal access from the dwelling to any other dwelling or part of a dwelling,

(c)that the separate use of the dwelling is not prohibited by the terms of any covenant, statutory planning consent or similar provision, and

(d)that the separate disposal of the dwelling is not prohibited by any such terms.

(5)For the purposes of this paragraph, a dwelling “is designed” for occupation of a particular kind if it is so designed—

(a)as a result of having been originally constructed for occupation of that kind and not having been subsequently adapted for occupation of any other kind, or

(b)as a result of adaptation.

Interpretation of paragraph 1(6): meaning of “qualifying conversion”

9(1)A “qualifying conversion” means—

(a)a changed number of dwellings conversion (see paragraph 10 below);

(b)house in multiple occupation conversion (see paragraph 11 below); or

(c)a special residential conversion (see paragraph 12 below).

(2)Sub-paragraph (1) above is subject to paragraphs 14 and 15 below.

Interpretation of paragraph 1(6): meaning of “changed number of dwellings conversion”

10(1)A “changed number of dwellings conversion” is—

(a)a conversion of premises consisting of a building where the conditions specified in this paragraph are satisfied, or

(b)a conversion of premises consisting of a part of a building where those conditions are satisfied.

(2)The first condition is that after the conversion the premises being converted contain a number of single household dwellings that is—

(a)different from the number (if any) that the premises contain before the conversion, and

(b)greater than, or equal to, one.

(3)The second condition is that there is no part of the premises being converted that is a part that after the conversion contains the same number of single household dwellings (whether zero, one or two or more) as before the conversion.

Interpretation of paragraph 1(6): meaning of “house in multiple occupation conversion”

11(1)A “house in multiple occupation conversion” is—

(a)a conversion of premises consisting of a building where the condition specified in sub-paragraph (2) below is satisfied, or

(b)a conversion of premises consisting of a part of a building where that condition is satisfied.

(2)The condition is that—

(a)before the conversion the premises being converted contain only a single household dwelling or two or more such dwellings,

(b)after the conversion those premises contain only a multiple occupancy dwelling or two or more such dwellings, and

(c)the use to which those premises are intended to be put after the conversion is not to any extent use for a qualifying residential purpose (see paragraph 17 below).

Interpretation of paragraph 1(6): meaning of “special residential conversion”

12(1)A “special residential conversion” is a conversion of premises consisting of—

(a)a building or two or more buildings,

(b)a part of a building or two or more parts of buildings, or

(c)a combination of—

(i)a building or two or more buildings, and

(ii)a part of a building or two or more parts of buildings,

where the conditions specified in this paragraph are satisfied.

(2)The first condition is that, before the conversion, the premises being converted contain only—

(a)a dwelling or two or more dwellings, or

(b)a dwelling, or two or more dwellings, and—

(i)an ancillary outbuilding occupied together with the dwelling or one or more of the dwellings, or

(ii)two or more ancillary outbuildings each occupied together with the dwelling or one or more of the dwellings.

(3)In sub-paragraph (2) above “dwelling” means single household dwelling or multiple occupancy dwelling.

(4)The second condition is that where before the conversion the premises being converted contain a multiple occupancy dwelling or two or more such dwellings, the use to which that dwelling, or any of those dwellings, was last put before the conversion was not to any extent use for a qualifying residential purpose (see paragraph 17 below).

(5)The third condition is that the premises being converted must be intended to be used after the conversion solely for a qualifying residential purpose.

(6)The fourth condition is that, where the qualifying residential purpose is an institutional purpose, the premises being converted must be intended to form after the conversion the entirety of an institution used for that purpose.

(7)In sub-paragraph (6) above “institutional purpose” means a purpose within paragraph 17(a) to (c), (f) or (g) below.

Special residential conversions: reduced rate only for supplies made to intended user of converted accommodation

13(1)This paragraph applies where the qualifying conversion concerned is a special residential conversion.

(2)Paragraph 1(6)(a) or (b) above does not apply to a supply unless—

(a)it is made to a person who intends to use the premises being converted for the qualifying residential purpose, and

(b)before it is made, the person to whom it is made has given to the person making it a certificate that satisfies the requirements in sub-paragraph (3) below.

(3)Those requirements are that the certificate—

(a)is in such form as may be specified in a notice published by the Commissioners, and

(b)states that the conversion is a special residential conversion.

(4)In sub-paragraph (2)(a) above “the qualifying residential purpose” means the purpose within paragraph 17 below for which the premises being converted are intended to be used after the conversion.

Interpretation of paragraph 1(6): “qualifying conversion” includes related garage works

14(1)A qualifying conversion includes any garage works related to the—

(a)changed number of dwellings conversion,

(b)house in multiple occupation conversion, or

(c)special residential conversion,

concerned.

(2)In this paragraph “garage works” means—

(a)the construction of a garage, or

(b)a conversion of a non-residential building, or of a non-residential part of a building, that results in a garage.

(3)For the purposes of sub-paragraph (1) above, garage works are “related” to a conversion if—

(a)they are carried out at the same time as the conversion, and

(b)the resulting garage is intended to be occupied with—

(i)where the conversion concerned is a changed number of dwellings conversion, a single household dwelling that will after the conversion be contained in the building, or part of a building, being converted,

(ii)where the conversion concerned is a house in multiple occupation conversion, a multiple occupancy dwelling that will after the conversion be contained in the building, or part of a building, being converted, or

(iii)where the conversion concerned is a special residential conversion, the institution or other accommodation resulting from the conversion.

(4)In sub-paragraph (2) above “non-residential” means neither designed, nor adapted, for use—

(a)as a dwelling or two or more dwellings, or

(b)for a qualifying residential purpose (see paragraph 17 below).

Interpretation of paragraph 1(6): conversion not “qualifying” if planning consent and building control approval not obtained

15(1)A conversion is not a qualifying conversion if any statutory planning consent needed for the conversion has not been granted.

(2)A conversion is not a qualifying conversion if any statutory building control approval needed for the conversion has not been granted.

Interpretation of paragraph 1(6): meaning of “supply of qualifying services”

16(1)In the case of a conversion of a building, “supply of qualifying services” means a supply of services that consists in—

(a)the carrying out of works to the fabric of the building, or

(b)the carrying out of works within the immediate site of the building that are in connection with—

(i)the means of providing water, power, heat or access to the building,

(ii)the means of providing drainage or security for the building, or

(iii)the provision of means of waste disposal for the building.

(2)In the case of a conversion of part of a building, “supply of qualifying services” means a supply of services that consists in—

(a)the carrying out of works to the fabric of the part, or

(b)the carrying out of works to the fabric of the building, or within the immediate site of the building, that are in connection with—

(i)the means of providing water, power, heat or access to the part,

(ii)the means of providing drainage or security for the part, or

(iii)the provision of means of waste disposal for the part.

(3)In this paragraph—

(a)references to the carrying out of works to the fabric of a building do not include the incorporation, or installation as fittings, in the building of any goods that are not building materials (see paragraph 22 below);

(b)references to the carrying out of works to the fabric of a part of a building do not include the incorporation, or installation as fittings, in the part of any goods that are not building materials.

Interpretation of paragraphs 11 to 14: meaning of “qualifying residential purpose”

17For the purposes of paragraphs 11 to 14 above, “use for a qualifying residential purpose” means use as—

(a)a home or other institution providing residential accommodation for children,

(b)a home or other institution providing residential accommodation with personal care for persons in need of personal care by reason of old age, disablement, past or present dependence on alcohol or drugs or past or present mental disorder,

(c)a hospice,

(d)residential accommodation for students or school pupils,

(e)residential accommodation for members of any of the armed forces,

(f)a monastery, nunnery or similar establishment, or

(g)an institution which is the sole or main residence of at least 90 per cent. of its residents,

except use as a hospital, prison or similar institution or an hotel, inn or similar establishment.

Interpretation of paragraph 1(7): introductory

18(1)Paragraph 1(7) above is interpreted in accordance with this paragraph and paragraphs 19 to 22 below.

(2)For the purposes of paragraph 1(7) above (and paragraphs 19 to 21 below)—

  • “alteration” includes extension;

  • “single household dwelling” has the meaning given by paragraph 8(2), (4) and (5) above.

Paragraph 1(7) only applies where dwelling has been empty for at least 3 years

19(1)Paragraph 1(7) above does not apply to a supply unless either of the empty home conditions is satisfied.

(2)The first “empty home condition” is that the dwelling concerned has not been lived in during the period of 3 years ending with the commencement of the relevant works.

(3)The second “empty home condition” is that—

(a)the dwelling was not lived in during a period of at least 3 years;

(b)the person, or one of the persons, whose beginning to live in the dwelling brought that period to an end was a person who (whether alone or jointly with another or others) acquired the dwelling at a time—

(i)no later than the end of that period, and

(ii)when the dwelling had been not lived in for at least 3 years;

(c)no works by way of renovation or alteration were carried out to the dwelling during the period of 3 years ending with the acquisition;

(d)the supply is made to a person who is—

(i)the person, or one of the persons, whose beginning to live in the property brought to an end the period mentioned in paragraph (a) above, and

(ii)the person, or one of the persons, who acquired the dwelling as mentioned in paragraph (b) above; and

(e)the relevant works are carried out during the period of one year beginning with the day of the acquisition.

(4)In this paragraph “the relevant works” means—

(a)where the supply is of the description set out in paragraph 1(7)(a) above, the works that constitute the services supplied;

(b)where the supply is of the description set out in paragraph 1(7)(b) above, the works by which the materials concerned are incorporated in the dwelling concerned or its immediate site.

(5)In sub-paragraph (3) above, references to a person acquiring a dwelling are to that person having a major interest in the dwelling granted, or assigned, to him for a consideration.

Paragraph 1(7) only applies if planning consent and building control approval obtained

20(1)Paragraph 1(7) above does not apply to a supply unless any statutory planning consent needed for the renovation or alteration has been granted.

(2)Paragraph 1(7) above does not apply to a supply unless any statutory building control approval needed for the renovation or alteration has been granted.

Interpretation of paragraph 1(7): meaning of “supply of qualifying services”

21(1)“Supply of qualifying services” means a supply of services that consists in—

(a)the carrying out of works to the fabric of the dwelling, or

(b)the carrying out of works within the immediate site of the dwelling that are in connection with—

(i)the means of providing water, power, heat or access to the dwelling,

(ii)the means of providing drainage or security for the dwelling, or

(iii)the provision of means of waste disposal for the dwelling.

(2)In sub-paragraph (1)(a) above, the reference to the carrying out of works to the fabric of the dwelling does not include the incorporation, or installation as fittings, in the dwelling of any goods that are not building materials (see paragraph 22 below).

Interpretation of paragraph 1(6) and (7): meaning of “building materials”

22“Building materials” has the meaning given by Notes (22) and (23) of Group 5 to Schedule 8 (zero-rating of construction and conversion of buildings)..

(3)The amendments made by this section have effect in relation to supplies made after the day on which this Act is passed.

98VAT: museums and galleries

(1)The Value Added Tax Act 1994 (c. 23) is amended as follows.

(2)After section 33 insert—

33ARefunds of VAT to museums and galleries

(1)Subsections (2) to (5) below apply where—

(a)VAT is chargeable on—

(i)the supply of goods or services to a body to which this section applies,

(ii)the acquisition of any goods by such a body from another member State, or

(iii)the importation of any goods by such a body from a place outside the member States,

(b)the supply, acquisition or importation is attributable to the provision by the body of free rights of admission to a relevant museum or gallery, and

(c)the supply is made, or the acquisition or importation takes place, on or after 1st April 2001.

(2)The Commissioners shall, on a claim made by the body in such form and manner as the Commissioners may determine, refund to the body the amount of VAT so chargeable.

(3)The claim must be made before the end of the claim period.

(4)Subject to subsection (5) below, “the claim period” is the period of 3 years beginning with the day on which the supply is made or the acquisition or importation takes place.

(5)If the Commissioners so determine, the claim period is such shorter period beginning with that day as the Commissioners may determine.

(6)Subsection (7) below applies where goods or services supplied to, or acquired or imported by, a body to which this section applies that are attributable to free admissions cannot conveniently be distinguished from goods or services supplied to, or acquired or imported by, the body that are not attributable to free admissions.

(7)The amount to be refunded on a claim by the body under this section shall be such amount as remains after deducting from the VAT related to the claim such proportion of that VAT as appears to the Commissioners to be attributable otherwise than to free admissions.

(8)For the purposes of subsections (6) and (7) above—

(a)goods or services are, and VAT is, attributable to free admissions if they are, or it is, attributable to the provision by the body of free rights of admission to a relevant museum or gallery;

(b)the VAT related to a claim is the whole of the VAT chargeable on—

(i)the supplies to the body, and

(ii)the acquisitions and importations by the body,

to which the claim relates.

(9)The Treasury may by order—

(a)specify a body as being a body to which this section applies;

(b)when specifying a body under paragraph (a), specify any museum or gallery that, for the purposes of this section, is a “relevant” museum or gallery in relation to the body;

(c)specify an additional museum or gallery as being, for the purposes of this section, a “relevant” museum or gallery in relation to a body to which this section applies;

(d)when specifying a museum or gallery under paragraph (b) or (c), provide that this section shall have effect in the case of the museum or gallery as if in subsection (1)(c) there were substituted for 1st April 2001 a later date specified in the order.

(10)References in this section to VAT do not include any VAT which, by virtue of any order under section 25(7), is excluded from credit under that section.

(3)In section 63 (penalties for misdeclarations etc.), after subsection (9) insert—

(9A)This section shall have effect in relation to a body which is registered and to which section 33A applies as if—

(a)any reference to a VAT credit included a reference to a refund under that section, and

(b)any reference to credit for input tax included a reference to VAT chargeable on supplies, acquisitions or importations which were attributable to the provision by the body of free rights of admission to a museum or gallery that in relation to the body was a relevant museum or gallery for the purposes of section 33A.

(4)Section 79 (repayment supplements) is amended in accordance with subsections (5) to (7).

(5)In subsection (1) (entitlement to supplement), after paragraph (b) insert— , or

(c)a body which is registered and to which section 33A applies is entitled to a refund under that section,.

(6)In subsection (5) (how supplement to be treated), after paragraph (b) insert— , and

(c)a supplement paid to any body under subsection (1)(c) shall be treated as an amount due to it by way of refund under section 33A.

(7)In subsection (6)(b) (meaning of “requisite return or claim”), after “section 33” insert “or (as the case may be) the Commissioners' determination under, and the provisions of, section 33A.”.

(8)In section 90(3) (VAT not to be refunded if it is repayable under the Provisional Collection of Taxes Act 1968 (c. 2)), after “section 33,” insert “33A,”.

(9)In Note (9) of Group 14 of Schedule 9 (no entitlement to both exemption and refund), after “33,” insert “33A,”.

(10)Subject to subsection (11), this section comes into force on 1st September 2001.

(11)For the purpose only of the exercise of the power to make orders under the section 33A(9) inserted by this section, this section comes into force on the day on which this Act is passed.

99VAT: re-enactment of reduced-rate provisions

(1)For the purpose of re-enacting the provisions of the Value Added Tax Act 1994 (c. 23) that provide for VAT on certain supplies, acquisitions and importations to be charged at a reduced rate of 5 per cent., that Act is amended as follows.

(2)In section 2(1) (VAT to be charged at the rate of 17.5 per cent.), after “Subject to the following provisions of this section” insert “and to the provisions of section 29A”.

(3)Section 2(1A) to (1C) and Schedule A1 (which are superseded by the new section 29A and Schedule 7A) shall cease to have effect.

(4)In Part 2 (reliefs, exemptions and repayments), after the heading “Reliefs etc. generally available” insert—

29AReduced rate

(1)VAT charged on—

(a)any supply that is of a description for the time being specified in Schedule 7A, or

(b)any equivalent acquisition or importation,

shall be charged at the rate of 5 per cent.

(2)The reference in subsection (1) above to an equivalent acquisition or importation, in relation to any supply that is of a description for the time being specified in Schedule 7A, is a reference (as the case may be) to—

(a)any acquisition from another member State of goods the supply of which would be such a supply; or

(b)any importation from a place outside the member States of any such goods.

(3)The Treasury may by order vary Schedule 7A by adding to or deleting from it any description of supply or by varying any description of supply for the time being specified in it.

(4)The power to vary Schedule 7A conferred by subsection (3) above may be exercised so as to describe a supply of goods or services by reference to matters unrelated to the characteristics of the goods or services themselves.

In the case of a supply of goods, those matters include, in particular, the use that has been made of the goods..

(5)After Schedule 7 insert the Schedule 7A set out in Part 1 of Schedule 31 to this Act.

(6)The consequential amendments in Part 2 of Schedule 31 to this Act have effect.

(7)The following provisions have effect in relation to supplies made, and acquisitions and importations taking place, on or after 1st November 2001—

(a)subsections (2) and (5),

(b)subsection (3) so far as providing for section 2(1A) and (1B), and Schedule A1, to cease to have effect, and

(c)subsection (4) so far as inserting subsections (1) and (2) of the new section 29A.

(8)Subsection (3), so far as providing for section 2(1C) to cease to have effect, comes into force on 1st November 2001.

(9)Subsection (6)—

(a)so far as relating to the amendments made by paragraphs 2 and 6(2) of Schedule 31 to this Act, has effect in relation to orders under section 2(2) of the Value Added Tax Act 1994 (c. 23) that make changes only in the rate of VAT that is in force at times on or after 1st November 2001;

(b)so far as relating to the amendment made by paragraph 3 of Schedule 31 to this Act, has effect in relation to supplies made, or to be made, on or after 1st November 2001.

100VAT representatives

(1)In section 48 of the Value Added Tax Act 1994 (VAT representatives), in subsection (1) (directions requiring appointment of representative), for paragraph (b) substitute—

(b)is not established, and does not have any fixed establishment, in the United Kingdom;

(ba)is established in a country or territory in respect of which it appears to the Commissioners that the condition specified in subsection (1A) below is satisfied; and.

(2)After that subsection insert—

(1A)The condition mentioned in subsection (1)(ba) above is that—

(a)the country or territory is neither a member State nor a part of a member State, and

(b)there is no provision for mutual assistance between the United Kingdom and the country or territory similar in scope to the assistance provided for between the United Kingdom and each other member State by the mutual assistance provisions.

(1B)In subsection (1A) above “the mutual assistance provisions” means—

(a)section 11 of the Finance Act 1977 (c. 36) (recovery of duty due etc. in other member States),

(b)section 77 of the Finance Act 1978 (c. 42) (disclosure of tax information to tax authorities in other member States), and

(c)Council Regulation (EEC) No. 218/92 of 27th January 1992 on administrative cooperation in the field of indirect taxation (VAT)..

(3)For subsection (2) of that section (power of taxable person to appoint representative) substitute—

(2)With the agreement of the Commissioners, a person—

(a)who has not been required under subsection (1) above to appoint another person to act on his behalf in relation to VAT, and

(b)in relation to whom the conditions specified in paragraphs (a), (b) and (c) of that subsection are satisfied,

may appoint another person to act on his behalf in relation to VAT.

(2A)In this Act “VAT representative” means a person appointed under subsection (1) or (2) above.

(4)The amendments made by this section come into force on 31st December 2001.

Petroleum revenue tax

101PRT: unrelievable field losses

(1)In section 6 of the Oil Taxation Act 1975 (c. 22) (allowance of unrelievable loss from abandoned field), for subsections (1) and (1A) substitute—

(1)In the case of a participator in an oil field, an allowable unrelievable field loss is the unrelievable portion of an allowable loss falling within subsection (1B) below.

(1A)Subsection (1) above is subject to subsections (5) to (9) below and Schedule 8 to this Act.

(1B)An allowable loss falls within this subsection if—

(a)the loss accrued in any chargeable period from another field (“the abandoned field”),

(b)the person to whom the loss accrued is—

(i)the participator, or

(ii)if the participator is a company, a company associated with the participator in respect of the loss (see subsection (3) below),

(c)the loss accrued to that person as a participator in the abandoned field, and

(d)the winning of oil from the abandoned field has permanently ceased.

(1C)The “unrelievable portion” of an allowable loss falling within subsection (1B) above is so much of that loss as cannot under the provisions of section 7 of this Act be relieved against assessable profits accruing from the abandoned field to the person to whom the loss accrued.

(1D)Subsection (1C) above is subject to Schedule 32 to the Finance Act 2001 (determination of unrelievable portion where Parts 2 and 3 of Schedule 17 to the Finance Act 1980 did not apply to transfer of interest in abandoned field)..

(2)In subsection (2) of that section, for “subsection (1) above” substitute “subsection (1B) above”.

(3)In section 113(2) of the Finance Act 1984 (c. 43)

(a)for the words from “which, in the case” to “in subsection (1)” substitute “falling within subsection (1B)”; and

(b)for “from that other field” substitute “from the abandoned field”.

(4)Schedule 32 to this Act has effect.

(5)The provisions of this section shall be deemed to have come into force on 7th March 2001.

102PRT: allowable decommissioning expenditure

(1)In section 3 of the Oil Taxation Act 1975 (c. 22) (allowable expenditure), for subsections (1C) and (1D) (apportionment of decommissioning expenditure) substitute—

(1C)In any case where—

(a)any expenditure incurred by a participator in a taxable field would, apart from this subsection, be allowable for the field under subsection (1)(i) or (j) above, and

(b)the qualifying asset that is relevant to the incurring of that expenditure has at some time been used otherwise than in connection with the field,

only the relevant portion of the expenditure is allowable for the field under subsection (1)(i) or (j) above.

(1D)In subsection (1C) above “the relevant portion” of the expenditure is the portion of the expenditure that it is just and reasonable to apportion to use of the asset that is use in connection with the field.

(1E)Subsections (1C) and (1D) above have effect subject to the transitional provisions in section 102(5) to (11) of the Finance Act 2001..

(2)In subsection (6) of that section, for “subsection (1C) or subsection (1D)” substitute “subsections (1C) and (1D)”.

(3)In section 10(2) of that Act (which, in particular, provides that although excluded oil is not oil for the purposes of section 3 of that Act it is oil for the purposes of section 3(1D)), for “subsection (1D)” substitute “subsections (1C) and (1D)”.

(4)The amendments made by subsections (1) to (3) apply to expenditure incurred on or after 7th March 2001.

(5)Subsections (6) to (8) apply where—

(a)on or after 7th March 2001 a participator in a taxable field (“the transitional participator”) incurs expenditure that falls to be apportioned under the new provision,

(b)the transitional participator was a participator in the field both immediately before, and at the beginning of, 7th March 2001,

(c)the qualifying asset that is relevant to the incurring of the expenditure was, at both of the times mentioned in paragraph (b), a qualifying asset in relation to the transitional participator and the field, and

(d)at a time before 7th March 2001—

(i)a person was a participator in two or more oil fields, and

(ii)the asset was a qualifying asset in relation to that person and each of at least two of those fields.

(6)If there would be no apportionment of the expenditure under the old provision, for the purpose of applying the new provision to the expenditure “the relevant portion” of the expenditure is the taxable field portion.

(7)If the expenditure would be apportioned between two or more oil fields under the old provision, for the purpose of applying the new provision to the expenditure “the relevant portion” of the expenditure is the portion of the taxable field portion which it is just and reasonable to apportion to use of the asset in connection with the field.

(8)In carrying out that apportionment of the taxable field portion, ignore use of the asset in connection with an oil field that is not one of the oil fields between which the expenditure would be apportioned under the old provision.

(9)In subsections (6) to (8) “the taxable field portion” means the portion of the expenditure that it is just and reasonable to apportion to use of the asset in connection with a taxable field.

(10)In subsections (5) to (8)—

  • “the new provision” means section 3(1C) of the Oil Taxation Act 1975 (c. 22) as substituted by subsection (1);

  • “the old provision” means section 3(1C) of that Act as it would have effect apart from the amendments made by subsections (1) to (3);

  • “qualifying asset” has the same meaning as it has for the purposes of the Oil Taxation Act 1983 (c. 56) (see section 8 of that Act).

(11)Subsections (5) to (10) shall be construed as one with Part 1 of the Oil Taxation Act 1975.

103PRT: expenditure in certain gas-producing fields

(1)In section 10 of the Oil Taxation Act 1975 (modifications of Part 1 in connection with gas sold to the British Gas Corporation under contracts made before end of June 1975), for subsection (3) (modified apportionment rule for expenditure allowable under section 3(1)(a), (b), (c), (hh), (i) or (j)) substitute—

(3)Subsections (3A) to (3H) below apply where, in the case of any taxable field, the oil—

(a)won and saved from the field, or

(b)expected to be won and saved from the field,

includes oil falling within subsection (1)(a) above.

(3A)Any expenditure allowable under section 3 of this Act for the field by virtue of any of paragraphs (a) to (c) of section 3(1) of this Act shall be a proportion of what it would otherwise have been.

(3B)The proportion mentioned in subsection (3A) above is that which, according to estimates submitted to the Secretary of State after the end of June 1975 and approved by him as reasonable, the field’s original reserves of oil exclusive of oil falling within subsection (1)(a) above bear to the field’s original reserves of oil inclusive of oil so falling.

(3C)Until estimates have been submitted and approved for the purpose of subsection (3B) above, the expenditure allowable for the field under section 3 of this Act by virtue of section 3(1)(a), (b) or (c) of this Act shall be deemed to be nil.

(3D)Any expenditure allowable under section 3 of this Act for the field by virtue of section 3(1)(hh) of this Act shall be a portion of what it would otherwise have been.

(3E)That portion is determined in accordance with the following rules—

1.Identify the abandonment guarantee (within the meaning given by section 104 of the Finance Act 1991 (c. 31)) on the obtaining of which the expenditure was incurred.

2.Identify the liabilities covered by the guarantee.

3.Identify which of those liabilities relate to qualifying assets.

4.Identify the portion of the expenditure that it is just and reasonable to apportion to the liabilities identified under rule 3.

5.Identify the qualifying assets to which the liabilities identified under rule 3 relate.

6.Identify the use of those qualifying assets that has been (or is expected to be) non-excluded use.

7.Assume that expenditure is incurred on the provision of those qualifying assets and identify the proportion of the hypothetical expenditure that it would be just and reasonable to apportion to the use of those assets identified under rule 6.

8.The portion mentioned in subsection (3D) above is then determined by multiplying—

(i)the portion identified under rule 4, by

(ii)the proportion (expressed as a fraction) identified under rule 7.

(3F)Any expenditure allowable under section 3 of this Act for the field by virtue of section 3(1)(i) or (j) of this Act shall be a portion of what it would otherwise have been.

(3G)That portion is determined in accordance with the following rules—

1.Identify the qualifying asset that is relevant to the incurring of the expenditure.

2.Identify the use of that qualifying asset that has been non-excluded use.

3.Assume that expenditure is incurred on the provision of that qualifying asset and identify the proportion of the hypothetical expenditure that it would be just and reasonable to apportion to the use of that asset identified under rule 2.

4.The portion mentioned in subsection (3F) above is then determined by multiplying—

(i)the expenditure, by

(ii)the proportion (expressed as a fraction) identified under rule 3.

(3H)In subsections (3E) and (3G) above—

  • “non-excluded use” means—

    (a)

    use in connection with the winning and saving of oil, other than excluded oil, from the field, or

    (b)

    use giving rise to receipts that, for the purposes of the Oil Taxation Act 1983 (c. 56), are tariff receipts attributable to a participator in the field;

  • “qualifying asset” has the same meaning as it has for the purposes of the Oil Taxation Act 1983 (see section 8 of that Act)..

(2)The amendments made by this section apply to expenditure incurred on or after 7th March 2001.

Landfill tax

104Landfill tax: rate

(1)In section 42 of the Finance Act 1996 (c. 8) (amount of landfill tax), in subsections (1)(a) and (2) for “£11” substitute “£12”.

(2)This section has effect in relation to taxable disposals made, or treated as made, on or after 1st April 2001.

Climate change levy

105Climate change levy

(1)Schedule 6 to the Finance Act 2000 (c. 17) (climate change levy) is amended as follows.

(2)After paragraph 11 insert—

Exemption: Northern Ireland gas supplies

11AA supply of gas is exempt from the levy if—

(a)the supply is made by a gas utility, and

(b)the person to whom the supply is made intends to cause the gas to be burned in Northern Ireland..

(3)In paragraph 14(2) (exemption for supplies to electricity producers does not apply to supplies to exempt unlicensed electricity suppliers, no matter what the electricity they produce is used for), at the end insert— , and

(c)uses the electricity produced otherwise than in exemption-retaining ways..

(4)For paragraph 14(3)(c) (uses of electricity produced by an auto-generator that cause auto-generator to lose benefit of exemption for supplies to electricity producers), substitute—

(c)uses the electricity produced otherwise than in exemption-retaining ways..

(5)In paragraph 14, after sub-paragraph (3) insert—

(3A)For the purposes of this paragraph, electricity is used in an “exemption-retaining” way if it is used—

(a)in making supplies that are excluded under paragraphs 8 to 10 or exempt under any of paragraphs 11, 12 and 18, or

(b)in any of the ways mentioned in sub-paragraphs (i) to (iv) of paragraph 13(b)..

(6)In paragraph 15(1)(a) (exemption for supplies to combined heat and power stations), for “the commodity is to be used by that person” there is substituted “that person intends to cause the commodity to be used”.

(7)The amendments made by this section have effect in relation to supplies made on or after 1st April 2001.

Inheritance tax

106Transfers within group etc

(1)Section 97 of the Inheritance Tax Act 1984 (c. 51) (transfers within group etc.) is amended as follows.

(2)In subsection (1) (minority participators in close company to be excluded from apportionment under section 94) for paragraph (a) (disposals to which section 171(1) of the Taxation of Chargeable Gains Act 1992 (c. 12) applies which are also transfers of value) substitute—

(a)there is—

(i)a disposal of an asset by the transferor company, which is a disposal to which section 171(1) of the 1992 Act applies, or

(ii)by virtue of an election under section 171A(2) of that Act, a deemed transfer by the transferor company to another member of the group,

(aa)the disposal is also, or the deemed transfer gives rise to, a transfer of value, and.

(3)The amendment made by this section has effect, and shall be taken always to have had effect, in relation to disposals made, or transfers deemed to have been made, on or after 1st April 2000.

Part 5Miscellaneous and supplementary provisions

Miscellaneous

107Interest on unpaid tax, etc.: foot-and-mouth disease

(1)This section applies in any case where, in exercise of their powers of care and management, the Commissioners of Inland Revenue agree that, by reason of circumstances arising as a result of the outbreak of foot-and-mouth disease, the payment of tax by a person may be deferred.

For this purpose “tax” includes any amount chargeable by way of tax, or as a result of the non-payment of tax, in respect of which interest would, apart from this section, be chargeable.

(2)Where this section applies no interest on the amount deferred shall be chargeable in respect of the period—

(a)beginning with 31st January 2001 or, if the Commissioners so direct in any case, any later date from which the agreement for deferred payment has effect, and

(b)ending with the date on which the agreement for deferred payment ceases to have effect.

(3)An agreement for deferred payment ceases to have effect at the end of the period of deferment specified in the agreement, subject as follows.

An agreement for deferred payment shall be treated as not ceasing to have effect if, or to the extent that, the Commissioners agree (whether before or after the end of the period of deferment specified in the agreement) to extend that period by reason of circumstances arising as a result of the outbreak of foot-and-mouth disease.

(4)For the purposes of subsection (3) as it applies to an agreement for payment by instalments, the period of deferment in relation to each instalment ends with the date on or before which that instalment is to be paid.

But if any instalment is not paid by the agreed date and the Commissioners do not agree in accordance with that subsection to extend the period of deferment, the whole agreement shall be treated as ceasing to have effect on that date.

(5)This section shall cease to have effect on a date specified by the Treasury by order made by statutory instrument.

This is without prejudice to its continued operation in relation to an agreement for deferred payment made by the Commissioners before the specified date.

(6)This section applies—

(a)whether the agreement for deferred payment was made before or after the passing of this Act, and

(b)whether the agreement for deferred payment was made before or after the amount to which it relates became due and payable.

(7)If in any case the Commissioners are satisfied that, although no agreement for deferred payment such as is mentioned in subsection (1) was made, such an agreement could have been made, this section shall apply as if such an agreement had been made.

The terms of the notional agreement shall be assumed to be such as the Commissioners are satisfied would have been agreed in the circumstances.

108Trading funds

(1)Section 2C of the Government Trading Funds Act 1973 (c. 63) (limits on borrowing and public dividend capital) is amended as follows.

(2)In subsection (3) (upper limit on aggregate of borrowing etc. maxima of trading funds), for “£2,000 million” substitute “£8,000 million”.

(3)In subsection (4) (power to increase limit in subsection (3) but not above £4,000 million), for “£4,000 million” substitute “£10,000 million”.

Supplementary

109Interpretation

In this Act “the Taxes Act 1988” means the Income and Corporation Taxes Act 1988 (c. 1).

110Repeals and revocations

(1)The enactments mentioned in Schedule 33 to this Act (which include provisions that are spent or of no practical utility) are repealed or revoked to the extent specified.

(2)The repeals and revocations specified in that Schedule have effect subject to the commencement provisions and savings contained or referred to in the notes set out in that Schedule.

111Short title

This Act may be cited as the Finance Act 2001.

SCHEDULES

Section 6.

SCHEDULE 1General betting duty

For sections 1 to 5 of the Betting and Gaming Duties Act 1981 (c. 63) (general betting duty: charge, rate and payment) substitute—

General betting duty

1The duty

A duty of excise to be known as general betting duty shall be charged in accordance with sections 2 to 5D.

2Bookmakers: general bets

(1)General betting duty shall be charged on a bet made with a bookmaker who is in the United Kingdom.

(2)Subsection (1) does not apply to—

(a)an on-course bet,

(b)a spread bet,

(c)a bet made by way of pool betting, or

(d)a bet made by way of coupon betting.

(3)The amount of duty charged in respect of bets made with a bookmaker in an accounting period shall be 15 per cent. of the amount of his net stake receipts for that period.

3Bookmakers: spread bets

(1)General betting duty shall be charged on a spread bet made with a bookmaker who—

(a)is in the United Kingdom, and

(b)holds a bookmaker’s permit.

(2)A bet is a spread bet if it constitutes a contract to which section 63 of the Financial Services Act 1986 applies by virtue of paragraphs 9 and 12 of Schedule 1 to that Act (gaming contracts: investments).

(3)The amount of duty charged under subsection (1) in respect of spread bets made with a bookmaker in an accounting period shall be—

(a)3 per cent. of the amount of his net stake receipts in respect of financial spread bets for that period (if any), plus

(b)10 per cent. of the amount of his net stake receipts in respect of other spread bets for that period (if any).

(4)A “financial spread bet” is a spread bet the subject of which is a financial matter.

(5)The Commissioners may by order provide that a specified matter—

(a)shall be treated as a financial matter for the purpose of subsection (4), or

(b)shall not be treated as a financial matter for that purpose.

4Other betting

(1)General betting duty shall be charged on sponsored pool betting.

(2)General betting duty shall be charged on a bet made by means of facilities provided by the Horserace Totalisator Board.

(3)General betting duty shall be charged on a bet made on an event on a track falling within subsection (4) if the bet is made—

(a)by means of a totalisator which operates on that track, and

(b)on the day of the event.

(4)A track falls within this subsection if—

(a)a track betting licence is in force for the track under Schedule 3 to the Betting, Gaming and Lotteries Act 1963,

(b)a track betting licence is in force for the track under Article 37 of the Betting, Gaming, Lotteries and Amusements (Northern Ireland) Order 1985, or

(c)the Commissioners designate the track for the purposes of this subsection.

(5)The amount of duty charged under subsections (1) to (3) in respect of bets made by means of facilities provided by a person in an accounting period shall be 15 per cent. of the amount of his net stake receipts for that period.

(6)Subsections (1) to (3) do not apply to—

(a)on-course bets, or

(b)coupon betting.

5Net stake receipts

(1)For the purposes of a charge under a provision of sections 2 to 4 in respect of the class of bets to which the provision applies, the amount of a person’s net stake receipts for an accounting period is X minus Y, where—

(a)X is the aggregate of amounts which fall due to that person in the accounting period in respect of bets of that class made with him, and

(b)Y is the aggregate of amounts paid by the person in that period by way of winnings to persons who made bets of that class with him (irrespective of when the bets were made or determined).

(2)Where—

(a)a person makes a bet other than a spread bet, and

(b)the sum which he will lose if unsuccessful is known when the bet is made,

that sum shall be treated for the purposes of subsection (1)(a) as falling due when the bet is made (irrespective of when it is actually paid or required to be paid).

(3)Where the amount of a person’s net stake receipts is zero or a negative amount, it shall be disregarded for the purposes of sections 2 to 4.

(4)In calculating an amount due to a person in respect of a bet, no deduction shall be made in respect of—

(a)any other benefit secured by the person who makes the bet as a result of paying the money,

(b)a person’s expenses, whether in paying duty or otherwise, or

(c)any other matter.

(5)Where a person makes a bet in pursuance of an offer which permits him to pay nothing or less than the amount which he would have been required to pay without the offer, he shall be treated for the purposes of this section as being due to pay that amount—

(a)to the person with whom the bet is made, and

(b)at the time when the bet is made.

(6)For the purpose of subsection (1)(b)—

(a)the reference to paying an amount to a person includes a reference to holding it in an account if the person is notified that the amount is being held for him in the account and that he is entitled to withdraw it on demand,

(b)the return of a stake shall be treated as a payment by way of winnings, and

(c)only payments of money shall be taken into account.

(7)In the application of this section to a charge under section 4(1) to (3), a reference to bets made with a person shall be treated as a reference to bets made by means of facilities provided by him.

5AMultiple bets

(1)Subject to subsection (3), this section applies where—

(a)a person bets on more than one contingency, and

(b)he bets on terms that if his bet in respect of one contingency is successful the stake or winnings will be carried forward as the stake in respect of another contingency.

(2)Where this section applies—

(a)the person mentioned in subsection (1)(a) shall be treated for the purposes of sections 2 to 4 as making a separate bet on each contingency, and

(b)each bet which depends on the result of an earlier bet shall be treated as being made at the time of that result.

(3)This section does not apply where a person bets on more than one contingency if—

(a)the betting takes the form of a single bet or of bets placed at a single time, and

(b)the terms mentioned in subsection (1) do not permit the arrangement for carrying forward to be varied or terminated.

(4)In subsection (1)(b) the reference to “the stake or winnings” includes a reference to—

(a)any part of the stake,

(b)any part of the winnings, and

(c)any combination of stake and winnings.

5BLiability to pay

(1)At the end of each accounting period all general betting duty chargeable in respect of bets made in the period shall become due.

(2)In the case of bets made with a bookmaker in an accounting period the general betting duty shall be paid—

(a)when it becomes due, and

(b)by the bookmaker.

(3)But general betting duty which is due to be paid by a bookmaker in respect of bets may be recovered from the following persons as if they and the bookmaker were jointly and severally liable to pay the duty—

(a)the holder of a bookmaker’s permit for the business in the course of which the bets were made;

(b)a person responsible for the management of that business;

(c)where the bookmaker is a company, a director.

(4)In the case of bets made in an accounting period by means of facilities provided by a person as described in section 4(1) to (3) the general betting duty shall be paid—

(a)when it becomes due, and

(b)by the person who provides the facilities.

(5)This section is without prejudice to paragraph 2 of Schedule 1 to this Act or regulations made under it.

5CBet-brokers

(1)This section applies where—

(a)one person (the “bettor”) makes a bet with another person (the “bet-taker”) using facilities provided in the course of a business by a third person (the “bet-broker”), or

(b)one person (the “bet-broker”) in the course of a business makes a bet with another person (the “bet-taker”) as the agent of a third person (the “bettor”) (whether the bettor is a disclosed principal or an undisclosed principal).

(2)For the purposes of sections 2 to 5B—

(a)the bet shall be treated as if it were made by the bettor with the bet-broker and not with the bet-taker,

(b)the bet-broker shall be treated as a bookmaker in respect of the bet,

(c)the aggregate of amounts due to be paid by the bettor in respect of the bet shall be treated as being due to the bet-broker, and

(d)a sum paid by the bet-taker by way of winnings in respect of the bet shall be treated as having been paid by the bet-broker at that time and for that purpose.

(3)But subsection (2) does not apply to a bet if—

(a)the bet-taker holds a bookmaker’s permit, and

(b)the bet would not be an on-course bet if the bet-broker were making the bet with the bet-taker as principal.

(4)In the case of a bet which is excluded from subsection (2) by virtue of subsection (3), for the purposes of sections 2 to 5B—

(a)the bet shall be treated as if it were made separately by the bettor with the bet-broker and by the bet-broker with the bet-taker,

(b)the bet-broker shall be treated as a bookmaker in respect of the bet,

(c)the aggregate of amounts due to be paid by the bettor in respect of the bet shall be treated as being due separately to the bet-broker and to the bet-taker (and any amount due to be paid by the bet-broker to the bet-taker shall be disregarded), and

(d)a sum paid by the bet-taker by way of winnings in respect of the bet shall be treated as having been paid separately by the bet-taker and by the bet-broker at that time and for that purpose (and any sum paid by the bet-broker shall be disregarded).

(5)This section does not apply—

(a)to bets made by way of pool betting, or

(b)to bets made using facilities provided by a person holding (and relying on) a betting agency permit (within the meaning of section 9(2)(c)(ii) of the Betting, Gaming and Lotteries Act 1963).

(6)Where there is any doubt as to which of two persons is the bettor and which the bet-taker for the purposes of subsection (1)(a), whichever of the two was the first to use the facilities of the bet-broker to offer the bet shall be treated as the bet-taker.

5DAccounting period

(1)For the purposes of sections 2 to 5C—

(a)each calendar month is an accounting period, but

(b)the Commissioners may provide in regulations under paragraph 2 of Schedule 1 to this Act for some other specified period to be an accounting period.

(2)Regulations made by virtue of subsection (1)(b) may—

(a)make provision which applies generally or only in relation to a specified person or class of person;

(b)make different provision for different purposes;

(c)make transitional provision..

1In section 6(1) of the Betting and Gaming Duties Act 1981 (c. 63) (pool betting duty) for “section 1(1)(c) above” substitute “section 4(3)”.

2For section 9(3)(a) of that Act (protection of revenue) substitute—

(a)to any bet which is made by way of pool betting or coupon betting if—

(i)the bet is not made by means of a totalisator,

(ii)the promoter is in the Isle of Man,

(iii)the bet is chargeable with a duty imposed by or under an Act of Tynwald which corresponds to pool betting duty, and

(iv)the duty mentioned in sub-paragraph (iii) is chargeable on the bet at a rate not less than the appropriate rate of pool betting duty; or

(aa)to any bet which is made with a bookmaker if—

(i)it is not made by way of pool betting or coupon betting,

(ii)the bookmaker is in the Isle of Man,

(iii)a duty is imposed by or under an Act of Tynwald in respect of bookmaker’s receipts from bets of that kind, and

(iv)the rates and method of calculation of that duty result in no less duty being charged in respect of bets of that kind than is charged by way of general betting duty in respect of bets of that kind; or.

3Paragraph 2(4)(b) and (c) of Schedule 1 to that Act (general betting duty: administration: records) shall cease to have effect.

Section 9.

SCHEDULE 2Rates of vehicle excise duty on goods vehicles

1Part 8 of Schedule 1 to the Vehicle Excise and Registration Act 1994 (c. 22) (annual rates of vehicle excise duty: goods vehicles) is amended as follows.

2For the Table in paragraph 9(1) (rigid goods vehicles not satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of vehicleRate
(1)(2)(3)(4)(5)
ExceedingNot ExceedingTwo axle vehicleThree axle vehicleFour or more axle vehicle
kgskgs£££
3,5007,500165165165
7,50012,000200200200
12,00013,000200200200
13,00014,000200200200
14,00015,000200200200
15,00017,000650200200
17,00019,000650200200
19,00021,000650200200
21,00023,000650450200
23,00025,000650650450
25,00027,000650650650
27,00029,0006506501,200
29,00031,0006506501,200
31,00044,0006506501,200

3In paragraph 9(3) (rigid goods vehicles not satisfying reduced pollution requirements and with a revenue weight exceeding 44,000 kilograms), for “£5,170” substitute “£2,585”.

4In paragraph 9A(3) (rigid goods vehicles satisfying reduced pollution requirements and with a revenue weight exceeding 44,000 kilograms), for “£4,170” substitute “£2,085”.

5For the Table in paragraph 9B (rigid goods vehicles satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of vehicleRate
(1)(2)(3)(4)(5)
ExceedingNot ExceedingTwo axle vehicleThree axle vehicleFour or more axle vehicle
kgskgs£££
3,5007,500160160160
7,50012,000160160160
12,00013,000160160160
13,00014,000160160160
14,00015,000160160160
15,00017,000280160160
17,00019,000280160160
19,00021,000280160160
21,00023,000280210160
23,00025,000280280210
25,00027,000280280280
27,00029,000280280700
29,00031,000280280700
31,00044,000280280700

6In paragraph 10(3) (trailer supplement for trailers exceeding 12,000 kilograms is 275 per cent of general rate), for “275” substitute “140”.

7For the Table in paragraph 11(1) (tractive units not satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of tractive unitRate for tractive unit with two axlesRate for tractive unit with three or more axles
(1)(2)(3)(4)(5)(6)(7)(8)
ExceedingNot exceedingAny no. of semi-trailer axles2 or more semi-trailer axles3 or more semi-trailer axlesAny no. of semi-trailer axles2 or more semi-trailer axles3 or more semi-trailer axles
kgskgs££££££
3,5007,500165165165165165165
7,50012,000165165165165165165
12,00016,000165165165165165165
16,00020,000165165165165165165
20,00023,000165165165165165165
23,00025,000165165165165165165
25,00026,000450165165165165165
26,00028,000450165165165165165
28,00031,000650650165450165165
31,00033,0001,2001,2004501,200450165
33,00034,0001,2001,2004501,200650165
34,00035,0001,5001,5001,2001,200650450
35,00036,0001,5001,5001,2001,200650450
36,00038,0001,5001,5001,2001,5001,200650
38,00041,0001,8501,8501,8501,8501,8501,200
41,00044,0001,8501,8501,8501,8501,8501,200

8In paragraph 11(3) (tractive units not satisfying reduced pollution requirements and with a revenue weight exceeding 44,000 kilograms), for “£5,170” substitute “£2,585”.

9In paragraph 11A(3) (tractive units satisfying reduced pollution requirements and with a revenue weight exceeding 44,000 kilograms), for “£4,170” substitute “£2,085”.

10For the Table in paragraph 11B (tractive units satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of tractive unitRate for tractive unit with two axlesRate for tractive unit with three or more axles
(1)(2)(3)(4)(5)(6)(7)(8)
ExceedingNot exceedingAny no. of semi-trailer axles2 or more semi-trailer axles3 or more semi-trailer axlesAny no. of semi-trailer axles2 or more semi-trailer axles3 or more semi-trailer axles
kgskgs££££££
3,5007,500160160160160160160
7,50012,000160160160160160160
12,00016,000160160160160160160
16,00020,000160160160160160160
20,00023,000160160160160160160
23,00025,000160160160160160160
25,00026,000210160160160160160
26,00028,000210160160160160160
28,00031,000280280160210160160
31,00033,000700700210700210160
33,00034,000700700210700280160
34,00035,0001,0001,000700700280210
35,00036,0001,0001,000700700280210
36,00038,0001,0001,0007001,000700280
38,00041,0001,3501,3501,3501,3501,350700
41,00044,0001,3501,3501,3501,3501,350700

11In paragraph 11C(2)(a) (certain tractive units not satisfying reduced pollution requirements and with a revenue weight exceeding 41,000 kilograms but not exceeding 44,000 kilograms), for “£1,280” substitute “£650”.

Section 15.

SCHEDULE 3Excise duty: payments by Commissioners in case of error or delay

Part 1Payments

Duty paid in error

1(1)This paragraph applies if—

(a)the first condition set out below is satisfied, and

(b)either the second or the third condition set out below is satisfied.

(2)The first condition is that, due to an error on the part of the Commissioners, any of the following occurs at any time—

(a)a person is refused authorisation for the purposes of section 8(1) or 10(1) of the Alcoholic Liquor Duties Act 1979 (c. 4);

(b)a person is refused a direction for the purposes of section 11(1) of that Act;

(c)a person is refused approval for the purposes of section 9(1) or 14(1) of the Hydrocarbon Oil Duties Act 1979 (c. 5);

(d)a person is refused consent for the purposes of section 10(1) of that Act.

(3)The second condition is that on or after the commencement day a person pays to the Commissioners an amount by way of excise duty which would not have been paid but for the error.

(4)The third condition is that on or after the commencement day the person refused pays for goods an amount which includes an amount which—

(a)represents a payment by way of excise duty, and

(b)would not have been included but for the error.

(5)If the second condition is satisfied the Commissioners may pay to the person refused an amount equal to the duty which would not have been paid.

(6)If the third condition is satisfied the Commissioners may pay to the person refused an amount which appears to them to be equal to the payment by way of excise duty.

(7)The person refused is the person refused an authorisation, direction, approval or consent.

Error relating to rebate

2(1)This paragraph applies if the following two conditions are satisfied.

(2)The first condition is that a person is entitled to use rebated heavy oil in particular circumstances.

(3)The second condition is that—

(a)due to an error on the part of the Commissioners he is unable to use rebated heavy oil in those circumstances,

(b)he uses unrebated heavy oil instead in those circumstances, and

(c)the use occurs on or after the commencement day.

(4)The Commissioners may pay to the person an amount equal to the rebate which would have been allowable under section 11 of the Hydrocarbon Oil Duties Act 1979 (c. 5) if—

(a)the heavy oil used by him in those circumstances had (at the time of that use) been delivered for home use, and

(b)the other conditions for allowing rebate had been satisfied at that time.

(5)Rebated heavy oil is heavy oil on whose delivery for home use a rebate has been allowed under section 11 of the Hydrocarbon Oil Duties Act 1979, and unrebated heavy oil is other heavy oil.

Claims

3No payment may be made to a person under this Part of this Schedule unless—

(a)he makes a claim in such form and manner, and containing such matters, as the Commissioners may prescribe by regulations, and

(b)he satisfies such other conditions as the Commissioners may impose by regulations.

Part 2Interest

Commissioners' delay

4(1)This paragraph applies if—

(a)a person is entitled to obtain an amount by way of repayment or drawback in respect of excise duty paid to the Commissioners,

(b)on or after the commencement day he makes a claim for the repayment or drawback, and

(c)the Commissioners fail to authorise it within the allowable period.

(2)The Commissioners must pay interest to the person on the amount for the applicable period.

(3)The allowable period is the period of 30 days starting with the day on which the Commissioners receive the claim.

(4)The applicable period is the period which—

(a)starts with the day after the allowable period ends, and

(b)ends with the day when the Commissioners authorise the repayment or drawback.

(5)Sub-paragraph (4) is subject to paragraph 6.

5(1)This paragraph applies if—

(a)a person is entitled to obtain an amount by way of repayment or drawback in respect of excise duty paid to the Commissioners,

(b)on or after the commencement day he makes a claim for the repayment or drawback,

(c)the Commissioners set off the amount against an assessment,

(d)the assessment is withdrawn, and

(e)the Commissioners authorise the repayment or drawback.

(2)The Commissioners must pay interest to the person on the amount for the applicable period.

(3)The applicable period is the period which—

(a)starts with the earlier of the days referred to in sub-paragraph (4), and

(b)ends with the day when the Commissioners authorise the repayment or drawback.

(4)The days are—

(a)the day the amount is set off;

(b)the day after the end of the period of 30 days starting with the day on which the Commissioners receive the claim.

(5)Sub-paragraphs (3) and (4) are subject to paragraph 6.

6(1)In deciding the applicable period for the purposes of paragraphs 4 and 5 any period by which the Commissioners' authorisation of the repayment or drawback is delayed by circumstances beyond their control must be ignored.

(2)In applying sub-paragraph (1) account must be taken in particular of any period referable to—

(a)any failure by any person to provide the Commissioners with information requested by them to enable the existence and amount of the claimant’s entitlement to a repayment or drawback to be determined;

(b)the making (in connection with the claim for repayment or drawback) of a claim to anything to which the claimant is not entitled.

(3)In deciding for the purposes of sub-paragraph (2)(a) whether a period of delay is referable to a failure by a person to provide information requested, the period mentioned in sub-paragraph (4) must be taken to be so referable (except so far as may be prescribed by the Commissioners by regulations).

(4)The period is that which—

(a)starts with the day when the Commissioners request the person to provide information they reasonably consider relevant to the matter to be determined, and

(b)ends with the earliest day when it would be reasonable for them to conclude that they have received a complete answer to their request or all they need to answer it, or to conclude that it is unnecessary for them to be provided with information in answer to their request.

Commissioners' error

7(1)This paragraph applies if—

(a)due to an error on the part of the Commissioners a person pays to them an amount by way of excise duty,

(b)the person is entitled to obtain repayment of the amount,

(c)he makes a claim (at any time) for the repayment and the Commissioners authorise it on or after the commencement day, and

(d)he makes a claim for interest under this paragraph before the end of the period of three years starting with the day when the Commissioners authorise the repayment.

(2)The Commissioners must pay interest to the person on the amount concerned for the applicable period.

(3)The applicable period is the period which—

(a)starts with the day when the payment is received by the Commissioners, and

(b)ends with the day when they authorise repayment.

(4)Sub-paragraph (3) is subject to paragraph 11.

8(1)This paragraph applies if—

(a)a person pays to the Commissioners an amount by way of excise duty,

(b)he is entitled to obtain an amount by way of repayment, remission, rebate or drawback in respect of the duty,

(c)due to an error on the part of the Commissioners he fails to claim the amount when he would (apart from the error) have done so,

(d)the person makes a claim (at any time) for the repayment, remission, rebate or drawback and the Commissioners authorise it on or after the commencement day, and

(e)he makes a claim for interest under this paragraph before the end of the period of three years starting with the day when the Commissioners authorise the repayment, remission, rebate or drawback.

(2)The Commissioners must pay interest to the person on the amount concerned for the applicable period.

(3)The applicable period is the period which—

(a)starts with the day when (apart from the error) the Commissioners might reasonably have been expected to authorise repayment, remission, rebate or drawback, and

(b)ends with the day when they authorise it.

(4)Sub-paragraph (3) is subject to paragraph 11.

9(1)This paragraph applies if—

(a)a person pays to the Commissioners an amount by way of excise duty,

(b)he is entitled to obtain an amount by way of repayment, remission, rebate or drawback in respect of the duty,

(c)he makes a claim (at any time) for the repayment, remission, rebate or drawback and the Commissioners authorise it,

(d)due to an error on the part of the Commissioners their authorisation is delayed,

(e)the Commissioners authorise the repayment, remission, rebate or drawback on or after the commencement day,

(f)neither paragraph 4 nor paragraph 5 applies in relation to the person, and

(g)the person makes a claim for interest under this paragraph before the end of the period of three years starting with the day when the Commissioners authorise the repayment, remission, rebate or drawback.

(2)The Commissioners must pay interest to the person on the amount concerned for the applicable period.

(3)The applicable period is the period which—

(a)starts with the day when (apart from the error) the Commissioners might reasonably have been expected to authorise repayment, remission, rebate or drawback, and

(b)ends with the day when they authorise it.

(4)Sub-paragraph (3) is subject to paragraph 11.

10(1)This paragraph applies if—

(a)a person makes a claim for a payment under paragraph 1 or 2 of this Schedule and the Commissioners authorise it, and

(b)he makes a claim for interest under this paragraph before the end of the period of three years starting with the day when the Commissioners authorise the payment.

(2)The Commissioners must pay interest to the person on the amount concerned for the applicable period.

(3)The applicable period is the period which—

(a)starts with the day when the second or third condition in paragraph 1 or the second condition in paragraph 2 (as the case may be) is satisfied in relation to that person, and

(b)ends with the day when the Commissioners authorise the payment under that paragraph.

(4)Sub-paragraph (3) is subject to paragraph 11.

11(1)In deciding the applicable period for the purposes of paragraphs 7 to 10 any period by which the Commissioners' authorisation of the repayment, remission, rebate, drawback or payment is delayed by circumstances beyond their control must be ignored.

(2)In applying sub-paragraph (1) account must be taken in particular of any period referable to—

(a)any unreasonable delay in claiming repayment, remission, rebate, drawback or payment;

(b)any failure by any person to provide the Commissioners with information requested by them to enable the existence and amount of a claimant’s entitlement to repayment, remission, rebate, drawback, payment or interest to be determined;

(c)the making (in connection with the claim for repayment, remission, rebate, drawback or payment) of a claim to anything to which the claimant is not entitled.

(3)In deciding for the purposes of sub-paragraph (2)(b) whether a period of delay is referable to a failure by a person to provide information requested, the period mentioned in sub-paragraph (4) must be taken to be so referable (except so far as may be prescribed by the Commissioners by regulations).

(4)The period is that which—

(a)starts with the day when the Commissioners request the person to provide information they reasonably consider relevant to the matter to be determined, and

(b)ends with the earliest day when it would be reasonable for them to conclude that they have received a complete answer to their request or all they need to answer it, or to conclude that it is unnecessary for them to be provided with information in answer to their request.

Claims

12(1)A claim for interest under a relevant paragraph must be made in such form and manner, and contain such matters, as the Commissioners may prescribe by regulations.

(2)If a person makes a claim under a relevant paragraph for interest on an amount, he may not make a claim under another relevant paragraph for interest on that amount.

(3)The relevant paragraphs are paragraphs 7 to 10.

Rate of interest

13In the case of interest under this Part of this Schedule, the rate is that applicable under section 197 of the Finance Act 1996 (c. 8) (rates of interest).

Part 3Appeals

14(1)This paragraph applies if—

(a)a person (the appellant) appeals to a tribunal under section 16 of the Finance Act 1994 (c. 9) in relation to an assessment to excise duty,

(b)the appellant pays, or gives cash security for, the whole or any part of that duty, and

(c)the tribunal finds that the whole or any part of the amount paid or secured is not due.

(2)The Commissioners must repay to the appellant an amount equal to—

(a)so much of the duty paid as is found not to be due, or

(b)so much of the cash security as relates to the duty found not to be due.

(3)The Commissioners must pay interest to the appellant on the amount referred to in sub-paragraph (2) for the period which—

(a)starts with the day when the duty is paid or the cash security is given, and

(b)ends with the day when the Commissioners authorise the repayment.

(4)The rate of interest is—

(a)such rate as the tribunal determines, or

(b)if it does not determine a rate, the rate applicable under section 197 of the Finance Act 1996.

(5)In this paragraph “cash security” means such adequate security as enables the Commissioners to place the amount in question on deposit.

Part 4General

Amendments

15In section 137A of the Customs and Excise Management Act 1979 (c. 2) (recovery of overpaid excise duty) insert after subsection (5)—

(6)This section does not apply in a case where the Commissioners are—

(a)entitled to pay an amount under Part 1 of Schedule 3 to the Finance Act 2001, or

(b)required to repay an amount under Part 3 of that Schedule..

16In section 16(9) of the Finance Act 1994 (c. 9) (matters which are not ancillary matters) for the words from “paragraph 9(e)” to the end substitute— the following paragraphs of Schedule 5—

(a)paragraph 3(4);

(b)paragraph 4(3);

(c)paragraph 9(e);

(d)paragraph 9A..

17(1)Schedule 5 to the Finance Act 1994 (decisions subject to review and appeal) is amended as follows.

(2)In paragraph 3 (decisions about alcoholic liquor) insert after sub-paragraph (3)—

(4)Any decision which—

(a)is made under paragraph 1 of Schedule 3 to the Finance Act 2001, and

(b)relates to the Alcoholic Liquor Duties Act 1979..

(3)In paragraph 4 (decisions about hydrocarbon oil) insert after sub-paragraph (2)—

(3)Any decision which—

(a)is made under paragraph 1 or 2 of Schedule 3 to the Finance Act 2001, and

(b)relates to the Hydrocarbon Oil Duties Act 1979..

(4)After paragraph 9 insert—

The Finance Act 2001

9AAny decision under or for the purposes of Part 2 of Schedule 3 to the Finance Act 2001 (interest)..

18(1)Section 197(2) of the Finance Act 1996 (c. 8) (setting rates of interest) is amended as follows.

(2)For paragraph (a) substitute—

(a)paragraph 7 of Schedule 6 to the Finance Act 1994 (interest payable to the Commissioners of Customs and Excise in connection with air passenger duty);.

(3)After paragraph (h) (which is inserted by section 49(2) of this Act) insert—

(i)Parts 2 and 3 of Schedule 3 to the Finance Act 2001 (interest payable on repayments etc.)..

19(1)Schedule 5 to the Finance Act 1997 (c. 16) (recovery of excess payments) is amended as follows.

(2)In paragraph 14 (assessment for excessive repayment) at the end of sub-paragraph (3)(b) omit “or” and after sub-paragraph (3)(c) insert— or

(d)Part 1 of Schedule 3 to the Finance Act 2001 (payments made and rebates disallowed in error)..

(3)In paragraph 15 (assessment for overpayments of interest) omit sub-paragraph (2)(a), at the end of sub-paragraph (2)(b) omit “or”, and after sub-paragraph (2)(c) insert— or

(d)Part 2 of Schedule 3 to the Finance Act 2001 (interest)..

(4)In paragraph 19 (review of decisions and appeals) in sub-paragraph (1)(c) for “the relevant interest provision is paragraph 9 of Schedule 6 to the Finance Act 1994” substitute “Part 1 of Schedule 3 to the Finance Act 2001 or the relevant interest provision is Part 2 of that Schedule”.

(5)In paragraph 20 (interpretation of Part 5) in sub-paragraph (2)(a)(ii) for “paragraph 9 of Schedule 6 to the Finance Act 1994” substitute “Part 2 of Schedule 3 to the Finance Act 2001”.

20In Schedule 6 to the Finance Act 1994 (c. 9), paragraphs 9 and 10 (interest in relation to air passenger duty) are omitted.

General

21(1)This Schedule shall come into force in accordance with provision made by the Commissioners by order.

(2)A reference in a provision of this Schedule to the commencement day is to such day as the Commissioners appoint by such order for the purposes of that provision.

22(1)A power to make an order or regulations under this Schedule is exercisable by statutory instrument.

(2)An order or regulations under this Schedule—

(a)may make different provision for different purposes;

(b)may make incidental, supplemental, saving or transitional provision.

(3)Regulations under this Schedule are subject to annulment in pursuance of a resolution of either House of Parliament.

23References in this Schedule to the Commissioners are to the Commissioners of Customs and Excise.

Section 24.

SCHEDULE 4Aggregates levy: registration

Notification of registrability etc.

1(1)An unregistered person who—

(a)has formed the intention of carrying out taxable activities,

(b)is required to be registered for the purposes of aggregates levy, or

(c)would be so required but for an exemption by virtue of regulations under section 24(4) of this Act,

shall notify the Commissioners of that fact.

(2)Subject to sub-paragraphs (5) and (6) below, a person who fails to comply with sub-paragraph (1) above shall be liable to a penalty.

(3)The amount of the penalty shall be—

(a)the amount equal to 5 per cent. of the relevant levy; or

(b)if it is greater or the circumstances are such that there is no relevant levy, £250.

(4)In sub-paragraph (3) above “relevant levy” means the aggregates levy (if any) to which the person in question is liable in respect of aggregate subjected to commercial exploitation in the period which—

(a)begins with the date with effect from which he is required to be registered for the purposes of that levy or, as the case may be, would be so required but for an exemption by virtue of regulations under section 24(4) of this Act; and

(b)ends with the date on which the Commissioners received notification of, or otherwise first became aware of, the fact that that person was required to be registered or is a person who would be so required but for such an exemption.

(5)A failure to comply with sub-paragraph (1) above shall not give rise to any liability to a penalty under this paragraph if the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the failure.

(6)Where, by reason of any conduct falling within sub-paragraph (2) above—

(a)a person is convicted of an offence (whether under this Act or otherwise), or

(b)a person is assessed to a penalty under paragraph 7 of Schedule 6 to this Act (penalty for evasion),

that person shall not by reason of that conduct be liable also to a penalty under this paragraph.

Form of registration

2(1)The Commissioners shall register a person who is required to be registered for the purposes of aggregates levy with effect from the time when the requirement arose.

(2)Where any two or more bodies corporate are members of the same group they shall be registered together as one person in the name of the representative member.

(3)The registration of a body corporate carrying on a business in several divisions may, if the body corporate so requests and the Commissioners see fit, be in the names of those divisions.

(4)The registration of—

(a)any two or more persons carrying on a business in partnership, or

(b)an unincorporated body,

may be in the name of the firm or body concerned.

Notification of loss or prospective loss of registrability

3(1)A person who, having become liable to give a notification by virtue of paragraph 1 above, ceases (whether before or after being registered) to have the intention of carrying out taxable activities shall notify the Commissioners of that fact.

(2)A person who fails to comply with sub-paragraph (1) above shall be liable to a penalty of £250.

Cancellation of registration

4(1)If the Commissioners are satisfied that a registered person—

(a)has ceased to carry out taxable activities, and

(b)does not have the intention of carrying out taxable activities,

they may cancel his registration with effect from such time after he last carried out such activities as appears to them to be appropriate.

(2)Sub-paragraph (1) above applies whether or not the registered person has notified the Commissioners under paragraph 3 above.

(3)Where a registered person is exempted from the requirement to be registered by virtue of regulations under section 24(4), the Commissioners may cancel his registration with effect from the time when he became so exempted or such later time as appears to them to be appropriate.

(4)The Commissioners shall be under a duty to exercise the power conferred by sub-paragraph (1) or (3) above with effect from any time if, where the power is exercisable, they are satisfied that the conditions specified in sub-paragraph (5) below are satisfied and were or will be satisfied at that time.

(5)Those conditions are—

(a)that the person in question—

(i)has given a notification under paragraph 3 above; or

(ii)is exempted from the requirement to be registered by virtue of regulations under section 24(4) of this Act;

(b)that no aggregates levy due from that person, and no amount recoverable as if it were such levy, remains unpaid;

(c)that no tax credit to which that person is entitled by virtue of any tax credit regulations is outstanding; and

(d)that that person is not subject to any outstanding liability to make a return for the purposes of aggregates levy.

(6)Where—

(a)a registered person notifies the Commissioners under paragraph 3 above, and

(b)they are satisfied that (if he had not been registered) he would not have been required to be registered at any time since the time when he was registered,

they shall cancel his registration with effect from the date of his registration.

(7)Where—

(a)a registered person is exempted from the requirement to be registered by virtue of regulations under section 24(4) of this Act, and

(b)the Commissioners are satisfied that he has been so exempted at all times since being registered,

they shall cancel his registration with effect from the date of his registration.

Correction of the register etc.

5(1)The Commissioners may by regulations make provision for and with respect to the correction of entries in the register.

(2)Regulations under this paragraph may, to such extent as appears to the Commissioners appropriate for keeping the register up to date, make provision requiring—

(a)registered persons, and

(b)persons who are required to be registered, and

(c)persons who would be so required but for any exemption by virtue of regulations under section 24(4) of this Act,

to notify the Commissioners of changes in circumstances relating to themselves, their businesses or any other matter with respect to which particulars are contained in the register (or would be, were the person registered).

Supplemental regulations about notifications

6(1)For the purposes of any provision made by or under section 24 of this Act or this Schedule for any matter to be notified to the Commissioners, regulations made by the Commissioners may make provision—

(a)as to the time within which the notification is to be given;

(b)as to the form and manner in which the notification is to be given; and

(c)as to the information and other particulars to be contained in or provided with any notification.

(2)For those purposes the Commissioners may also by regulations impose obligations requiring a person who has given a notification to notify the Commissioners if any information contained in or provided in connection with that notification is or becomes inaccurate.

(3)The power under this paragraph to make regulations as to the time within which any notification is to be given shall include power to authorise the Commissioners to extend the time for the giving of a notification.

Publication of information on the register

7(1)The Commissioners may publish, by such means as they think fit, any information which—

(a)is derived from the register; and

(b)falls within any of the descriptions set out below.

(2)The descriptions are—

(a)the names of registered persons;

(b)particulars of registered sites;

(c)the fact (where it is the case) that the registered person is a body corporate which is a member of a group;

(d)the names of the other bodies corporate which are members of the group.

(3)Information may be published in accordance with this paragraph notwithstanding any obligation not to disclose the information that would otherwise apply.

Interpretation of Schedule

8(1)In this Schedule—

(a)references to the register are references to the register maintained under section 24 of this Act;

(b)references to registering a person are references to registering him in that register; and

(c)references to a person’s registration are references to his registration in that register;

and “unregistered” shall be construed accordingly.

(2)For the purposes of this Schedule a person carries out a taxable activity if a quantity of aggregate is subjected to commercial exploitation in the United Kingdom in circumstances in which he is responsible for its being so subjected.

Section 27.

SCHEDULE 5Aggregates levy: recovery and interest

Recovery of levy as debt due

1Aggregates levy shall be recoverable as a debt due to the Crown.

Assessments of amounts of levy due

2(1)Where it appears to the Commissioners—

(a)that any period is an accounting period by reference to which a person is liable to account for aggregates levy,

(b)that any aggregates levy for which that person is liable to account by reference to that period has become due, and

(c)that there has been a default by that person that falls within sub-paragraph (2) below,

they may assess the amount of the levy due from that person for that period to the best of their judgement and notify that amount to that person.

(2)The defaults falling within this sub-paragraph are—

(a)any failure to make a return required to be made by any provision made by or under this Part of this Act;

(b)any failure to keep any documents necessary to verify returns required to be made under any such provision;

(c)any failure to afford the facilities necessary to verify returns required to be made under any such provision;

(d)the making, in purported compliance with any requirement of any such provision to make a return, of an incomplete or incorrect return;

(e)any failure to comply with a requirement imposed by or under Schedule 4 to this Act.

(3)Where it appears to the Commissioners that a default falling within sub-paragraph (2) above is a default by a person on whom the requirement to make a return is imposed in his capacity as the representative of another person, sub-paragraph (1) above shall apply as if the reference to the amount of aggregates levy due included a reference to any aggregates levy due from that other person.

(4)In a case where—

(a)the Commissioners have made an assessment for any accounting period as a result of any person’s failure to make a return for that period,

(b)the levy assessed has been paid but no proper return has been made for that period,

(c)as a result of a failure (whether by that person or a representative of his) to make a return for a later accounting period, the Commissioners find it necessary to make another assessment under this paragraph in relation to the later period, and

(d)the Commissioners think it appropriate to do so in the light of the absence of a proper return for the earlier period,

they may, in the assessment in relation to the later period, specify an amount of aggregates levy due that is greater than the amount that they would have considered to be appropriate had they had regard only to the later period.

(5)Where an amount has been assessed and notified to any person under this paragraph, it shall be recoverable on the basis that it is an amount of aggregates levy due from him.

(6)Sub-paragraph (5) above does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.

Supplementary assessments

3(1)If, where an assessment has been notified to any person under paragraph 2 above or this paragraph, it appears to the Commissioners that the amount which ought to have been assessed as due for any accounting period exceeds the amount that has already been assessed, the Commissioners may make a supplementary assessment of the amount of the excess and notify that person accordingly.

(2)Where an amount has been assessed and notified to any person under this paragraph it shall be recoverable on the basis that it is an amount of aggregates levy due from him.

(3)Sub-paragraph (2) above does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.

Time limits for assessments

4(1)An assessment under paragraph 2 or 3 above of an amount of aggregates levy due for any accounting period—

(a)shall not be made more than two years after the end of the accounting period unless it is made within the period mentioned in sub-paragraph (2) below; and

(b)subject to sub-paragraph (3) below, shall not in any event be made more than three years after the end of that accounting period.

(2)The period referred to in sub-paragraph (1)(a) above is the period of one year after evidence of facts sufficient in the Commissioners' opinion to justify the making of the assessment first came to their knowledge.

(3)Subject to sub-paragraph (4) below, where aggregates levy has been lost—

(a)as a result of any conduct for which a person has been convicted of an offence involving fraud,

(b)in circumstances giving rise to liability to a penalty under paragraph 1 of Schedule 4 to this Act (failure to notify of registrability etc.), or

(c)as a result of conduct falling within paragraph 7(1) of Schedule 6 to this Act (evasion),

that levy may be assessed under paragraph 2 or 3 above as if, in sub-paragraph (1)(b) above, for “three years” there were substituted “twenty years”.

(4)Where, after a person’s death, the Commissioners propose to assess an amount of aggregates levy as due by reason of some conduct of the deceased—

(a)the assessment shall not be made more than three years after the death; and

(b)if the circumstances are as set out in sub-paragraph (3) above—

(i)the modification of sub-paragraph (1) above contained in that sub-paragraph shall not apply; but

(ii)any assessment which (applying that modification) could have been made immediately after the death may be made at any time within three years after it.

(5)Nothing in this paragraph shall prejudice the powers of the Commissioners under paragraph 2(4) above.

Penalty interest on unpaid levy

5(1)Where—

(a)a person makes a return for the purposes of any regulations made under section 25 of this Act (whether or not at the time required by the regulations), and

(b)the return shows that an amount of aggregates levy is due from him for the accounting period for which the return is made,

that amount shall carry penalty interest for the period specified in sub-paragraph (2) below.

(2)That period is the period which—

(a)begins with the day after that on which the person is required in accordance with regulations under section 25 of this Act to pay aggregates levy due from him for the accounting period in question; and

(b)ends with the day before that on which the amount shown in the return is paid.

Interest on overdue levy paid before assessment

6(1)Where—

(a)the circumstances are such that there was a time when an assessment could have been made under paragraph 2 or 3 above of an amount of levy due from any person, but

(b)before the making and notification to that person of any assessment of that amount, the amount was paid,

the whole of the amount paid shall be taken to have carried interest for the period specified in sub-paragraph (2).

(2)That period is the period which—

(a)begins with the day after that on which the person is required in accordance with regulations under section 25 of this Act to pay aggregates levy due from him for the accounting period to which the amount in question relates; and

(b)ends with the day before that on which that amount was paid.

(3)The interest payable by virtue of this paragraph shall be payable at the rate applicable under section 197 of the Finance Act 1996 (c. 8).

Penalty interest on levy where no return made

7(1)Where—

(a)the Commissioners make an assessment under paragraph 2 or 3 above of an amount of aggregates levy due from any person for any accounting period and notify it to him, and

(b)the assessment is made at a time after the time by which a return is required by regulations under section 25 of this Act to be made by that person for that accounting period and before any such return has been made,

that amount shall carry penalty interest for the period specified in sub-paragraph (2) below.

(2)That period is the period which—

(a)begins with the day after that on which the person is required in accordance with regulations under section 25 of this Act to pay aggregates levy due from him for the accounting period in question; and

(b)ends with the day before that on which the assessed amount is paid.

Ordinary and penalty interest on under-declared levy

8(1)Subject to sub-paragraph (4) below, where—

(a)the Commissioners make an assessment under paragraph 2 or 3 above of an amount of aggregates levy due from any person for any accounting period and notify it to him,

(b)the assessment is made after a return for the purposes of any regulations under section 25 has been made by that person for that accounting period, and

(c)the assessment is made on the basis that the amount (“the additional amount”) is due from him in addition to any amount shown in the return, or in a previous assessment made in relation to the accounting period,

the additional amount shall carry interest for the period specified in sub-paragraph (2) below.

(2)That period is the period which—

(a)begins with the day after that on which the person is required in accordance with regulations under section 25 of this Act to pay aggregates levy due from him for the accounting period in question; and

(b)ends with the day before the day on which the additional amount is paid.

(3)Interest under this paragraph—

(a)in respect of so much of the period specified in sub-paragraph (2) above as falls before the day on which the assessment is notified to the person in question, shall be payable at the rate applicable under section 197 of the Finance Act 1996 (c. 8); and

(b)in respect of the remainder (if any) of that period, shall be penalty interest.

(4)Where—

(a)the Commissioners make an assessment under paragraph 2 or 3 above of an amount of aggregates levy due from any person for any accounting period and notify it to him,

(b)they also specify a date for the purposes of this sub-paragraph, and

(c)the amount assessed is paid on or before that date,

the only interest carried by that amount under this paragraph shall be interest, at the rate given by sub-paragraph (3)(a) above, for the period before the day on which the assessment is notified.

Penalty interest on unpaid ordinary interest

9(1)Subject to sub-paragraph (2) below, where the Commissioners make an assessment under paragraph 12 below of an amount of interest payable at the rate given by paragraph 8(3)(a) above, that amount shall carry penalty interest for the period which—

(a)begins with the day on which the assessment is notified to the person on whom the assessment is made; and

(b)ends with the day before the day on which the assessed interest is paid.

(2)Where—

(a)the Commissioners make an assessment under paragraph 12 below of an amount of interest due from any person,

(b)they also specify a date for the purposes of this sub-paragraph, and

(c)the amount of interest assessed is paid on or before that date,

the amount paid before that date shall not carry penalty interest under this paragraph.

Penalty interest

10(1)Penalty interest under any of paragraphs 5 to 9 above shall be compound interest calculated—

(a)at the penalty rate; and

(b)with monthly rests.

(2)For this purpose the penalty rate is the rate found by—

(a)taking the rate applicable under section 197 of the Finance Act 1996 (c. 8) for the purposes of paragraph 8(3)(a) above; and

(b)adding 10 percentage points to that rate.

(3)Where a person is liable under any of paragraphs 5 to 9 above to pay any penalty interest, the Commissioners or, on appeal, an appeal tribunal may reduce the amount payable to such amount (including nil) as they think proper.

(4)Subject to sub-paragraph (5) below, where the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the conduct giving rise to the liability to pay penalty interest, that is a matter which (among other things) may be taken into account under sub-paragraph (3) above.

(5)In determining whether there is a reasonable excuse for the purposes of sub-paragraph (4) above, no account shall be taken of any of the following matters, that is to say—

(a)the insufficiency of the funds available to any person for paying any aggregates levy due or for paying the amount of the interest;

(b)the fact that there has, in the case in question or in that case taken with any other cases, been no or no significant loss of aggregates levy;

(c)the fact that the person liable to pay the interest or a person acting on his behalf has acted in good faith.

(6)In the case of interest reduced by the Commissioners under sub-paragraph (3) above an appeal tribunal, on an appeal relating to the interest, may cancel the whole or any part of the reduction made by the Commissioners.

Supplemental provisions about interest

11(1)Interest under any of paragraphs 5 to 9 above shall be paid without any deduction of income tax.

(2)Sub-paragraph (3) below applies where—

(a)an amount carries interest under any of paragraphs 5 to 9 above (or would do so apart from that sub-paragraph); and

(b)all or part of the amount turns out not to be due.

(3)In such a case—

(a)the amount or part that turns out not to be due shall not carry interest under the applicable paragraph and shall be treated as never having done so; and

(b)all such adjustments as are reasonable shall be made, including (subject to section 32 of, and Schedule 8 to, this Act) adjustments by way of repayment.

Assessments to interest

12(1)Where a person is liable for interest under any of paragraphs 5 to 9 above, the Commissioners may assess the amount due by way of interest and notify it to him accordingly.

(2)If, where an assessment has been notified to any person under sub-paragraph (1) above or this sub-paragraph, it appears to the Commissioners that the amount which ought to have been assessed exceeds the amount that has already been assessed, the Commissioners may make a supplementary assessment of the amount of the excess and notify that person accordingly.

(3)Where an amount has been assessed and notified to any person under this paragraph, it shall be recoverable as if it were aggregates levy due from him.

(4)Sub-paragraph (3) above—

(a)shall not apply so as to require any interest to be payable on interest except—

(i)in accordance with paragraph 9 above; or

(ii)in so far as it falls to be compounded in accordance with paragraph 10 above;

and

(b)shall not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.

(5)Paragraph 4 above shall apply in relation to assessments under this paragraph as if any assessment to interest were an assessment under paragraph 2 above to aggregates levy due for the period which is the relevant accounting period in relation to that interest.

(6)Subject to sub-paragraph (7) below, where a person—

(a)is assessed under this paragraph to an amount due by way of any interest, and

(b)is also assessed under paragraph 2 or 3 above for the accounting period which is the relevant accounting period in relation to that interest,

the assessments may be combined and notified to him as one assessment.

(7)A notice of a combined assessment under sub-paragraph (6) above must separately identify the interest being assessed.

(8)The relevant accounting period for the purposes of this paragraph is—

(a)in the case of interest on the levy due for any accounting period, that accounting period; and

(b)in the case of interest on interest (whether under paragraph 9 above or by virtue of any compounding under paragraph 10 above) the period which is the relevant accounting period for the interest on which the interest is payable.

(9)In a case where—

(a)the amount of any interest falls to be calculated by reference to aggregates levy which was not paid at the time when it should have been, and

(b)that levy cannot be readily attributed to any one or more accounting periods,

that levy shall be treated for the purposes of interest on any of that levy as aggregates levy due for such period or periods as the Commissioners may determine to the best of their judgement and notify to the person liable.

Further assessments to penalty interest

13(1)Where an assessment is made under paragraph 12 above to an amount of penalty interest under any of paragraphs 5 to 9 above—

(a)the notice of assessment shall specify a date, not later than the date of the notice of assessment, to which the amount of interest which is assessed is calculated; and

(b)if the interest continues to accrue after that date, a further assessment or further assessments may be made under paragraph 12 above in respect of the amounts so accruing.

(2)Where—

(a)an assessment to penalty interest is made specifying a date for the purposes of sub-paragraph (1)(a) above, and

(b)within such period as may for the purposes of this sub-paragraph have been notified by the Commissioners to the person liable for the interest, the amount on which the interest is payable is paid,

that amount shall be deemed for the purposes of any further liability to interest to have been paid on the specified date.

Recovery by distress

14In section 51(5) of the Finance Act 1997 (c. 16) (definition of relevant taxes for the purposes of the power to make provision by regulations for enforcement by distress of the relevant taxes), after paragraph (d) there shall be inserted—

(da)aggregates levy;.

Walking possession agreements

15(1)This paragraph applies where—

(a)in accordance with regulations made by virtue of paragraph 14 above a distress is authorised to be levied on the goods and chattels of a person;

(b)that person (“the person in default”) has refused or neglected to pay an amount of aggregates levy due from him or an amount recoverable from him as if it were aggregates levy; and

(c)the person levying the distress and the person in default have entered into a walking possession agreement.

(2)For the purposes of this paragraph a walking possession agreement is an agreement under which, in consideration of the property distrained upon being allowed to remain in the custody of the person in default and of the delaying of its sale, the person in default—

(a)acknowledges that the property specified in the agreement is under distraint and held in walking possession; and

(b)undertakes that, except with the consent of the Commissioners and subject to such conditions as they may impose, he will not remove or allow the removal of any of the specified property from the premises named in the agreement.

(3)Subject to sub-paragraph (4) below, if the person in default is in breach of the undertaking contained in a walking possession agreement, he shall be liable to a penalty equal to one half of the levy or other amount referred to in sub-paragraph (1)(b) above.

(4)The person in default shall not be liable to a penalty under sub-paragraph (3) above if he satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the breach in question.

(5)This paragraph does not extend to Scotland.

Recovery by diligence

16In section 52(5) of the Finance Act 1997 (c. 16) (definition of relevant taxes for the purposes of the power to make provision by regulations for enforcement by diligence of the relevant taxes), after paragraph (d) there shall be inserted—

(da)aggregates levy;.

Preferential debts in England and Wales and Northern Ireland

17(1)In the Insolvency Act 1986 (c. 45)

(a)in section 386(1) (preferential debts), after “climate change levy,”, there shall be inserted “aggregates levy,”; and

(b)in Schedule 6 (categories of preferential debts), the paragraph set out in sub-paragraph (2) below shall be inserted after paragraph 3C.

(2)That paragraph is as follows—

3DAny aggregates levy which is referable to the period of 6 months next before the relevant date (which period is referred to below as “the 6-month period”).

For the purposes of this paragraph—

(a)where the whole of the accounting period to which any aggregates levy is attributable falls within the 6-month period, the whole amount of that levy is referable to that period; and

(b)in any other case the amount of any aggregates levy which is referable to the 6-month period is the proportion of the levy which is equal to such proportion (if any) of the accounting period in question as falls within the 6-month period;

and references here to accounting periods shall be construed in accordance with Part 2 of the Finance Act 2001..

(3)In the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19))—

(a)in Article 346(1) (preferential debts), after “climate change levy,”, there shall be inserted “aggregates levy,”; and

(b)in Schedule 4 (categories of preferential debts), the paragraph set out in sub-paragraph (4) below shall be inserted after paragraph 3C.

(4)That paragraph is as follows—

3DAny agggregates levy which is referable to the period of 6 months next before the relevant date (which period is referred to below as “the 6-month period”).

For the purposes of this paragraph—

(a)where the whole of the accounting period to which any aggregates levy is attributable falls within the 6-month period, the whole amount of that levy is referable to that period; and

(b)in any other case the amount of any aggregates levy which is referable to the 6-month period is the proportion of the levy which is equal to such proportion (if any) of the accounting period in question as falls within the 6-month period;

and references here to accounting periods shall be construed in accordance with Part 2 of the Finance Act 2001..

Preferred debts in Scotland

18(1)In paragraph 2 of Schedule 3 to the Bankruptcy (Scotland) Act 1985 (c. 66) (tax liabilities that are preferred debts), the following sub-paragraph shall be inserted before sub-paragraph (2)—

(1D)Any aggregates levy which is referable to the period of six months next before the relevant date.

(2)In that Schedule, the following paragraph shall be inserted after paragraph 8C—

Periods to which aggregates levy referable

8D(1)For the purpose of paragraph 2(1D) of Part 1 of this Schedule—

(a)where the whole of the accounting period to which any aggregates levy is attributable falls within the period of six months next before the relevant date (‘the relevant period’), the whole amount of that levy shall be referable to the relevant period; and

(b)in any other case the amount of any aggregates levy which shall be referable to the relevant period shall be the proportion of the levy which is equal to such proportion (if any) of the accounting period in question as falls within the relevant period.

(2)In sub-paragraph (1) above ‘accounting period’ shall be construed in accordance with Part 2 of the Finance Act 2001..

Interpretation of Schedule etc.

19(1)In this Schedule “penalty interest” shall be construed in accordance with paragraph 10 above.

(2)Any notification of an assessment under any provision of this Schedule to a person’s representative shall be treated for the purposes of this Part of this Act as notification to the person in relation to whom the representative acts.

(3)In this Schedule “representative”, in relation to any person, means—

(a)any of that person’s personal representatives;

(b)that person’s trustee in bankruptcy or liquidator;

(c)any person holding office as a receiver in relation to that person or any of his property;

(d)that person’s tax representative or any other person for the time being acting in a representative capacity in relation to that person.

(4)In this paragraph “trustee in bankruptcy” includes, as respects Scotland—

(a)an interim or permanent trustee (within the meaning of the Bankruptcy (Scotland) Act 1985); and

(b)a trustee acting under a trust deed (within the meaning of that Act).

Section 28.

SCHEDULE 6Aggregates levy: evasion, misdeclaration and neglect

Part 1Criminal offences

Evasion

1(1)A person is guilty of an offence if he is knowingly concerned in, or in the taking of steps with a view to—

(a)the fraudulent evasion by that person of any aggregates levy with which he is charged; or

(b)the fraudulent evasion by any other person of any aggregates levy with which that other person is charged.

(2)The references in sub-paragraph (1) above to the evasion of aggregates levy include references to obtaining, in circumstances where there is no entitlement to it, either a tax credit or a repayment of aggregates levy.

(3)A person guilty of an offence under this paragraph shall be liable (subject to sub-paragraph (4) below)—

(a)on summary conviction, to a penalty of the statutory maximum or to imprisonment for a term not exceeding six months, or to both;

(b)on conviction on indictment, to a penalty of any amount or to imprisonment for a term not exceeding seven years, or to both.

(4)In the case of any offence under this paragraph, where the statutory maximum is less than three times the sum of the amounts of aggregates levy which are shown to be amounts that were or were intended to be evaded, the penalty on summary conviction shall be the amount equal to three times that sum (instead of the statutory maximum).

(5)For the purposes of sub-paragraph (4) above the amounts of levy that were or were intended to be evaded shall be taken to include—

(a)the amount of any tax credit, and

(b)the amount of any repayment of aggregates levy,

which was, or was intended to be, obtained in circumstances where there was no entitlement to it.

(6)In determining for the purposes of sub-paragraph (4) above how much aggregates levy (in addition to any amount falling within sub-paragraph (5) above) was or was intended to be evaded, no account shall be taken of the extent (if any) to which any liability to aggregates levy of any person fell, or would have fallen, to be reduced by the amount of any tax credit or repayment of aggregates levy to which he was, or would have been, entitled.

Misstatements

2(1)A person is guilty of an offence if, with the requisite intent and for purposes connected with aggregates levy—

(a)he produces or provides, or causes to be produced or provided, any document which is false in a material particular; or

(b)he otherwise makes use of such a document;

and in this sub-paragraph “the requisite intent” means the intent to deceive any person or to secure that a machine will respond to the document as if it were a true document.

(2)A person is guilty of an offence if, in providing any information under any provision made by or under this Part of this Act—

(a)he makes a statement which he knows to be false in a material particular; or

(b)he recklessly makes a statement which is false in a material particular.

(3)A person guilty of an offence under this paragraph shall be liable (subject to sub-paragraph (4) below)—

(a)on summary conviction, to a penalty of the statutory maximum or to imprisonment for a term not exceeding six months, or to both;

(b)on conviction on indictment, to a penalty of any amount or to imprisonment for a term not exceeding seven years, or to both.

(4)In the case of any offence under this paragraph, where—

(a)the document referred to in sub-paragraph (1) above is a return required under any provision made by or under this Part of this Act, or

(b)the information referred to in sub-paragraph (2) above is contained in or otherwise relevant to such a return,

the amount of the penalty on summary conviction shall be whichever is the greater of the statutory maximum and the amount equal to three times the sum of the amounts (if any) by which the return understates any person’s liability to aggregates levy.

(5)In sub-paragraph (4) above the reference to the amount by which any person’s liability to aggregates levy is understated shall be taken to be equal to the sum of—

(a)the amount (if any) by which his gross liability was understated; and

(b)the amount (if any) by which any entitlements of his to tax credits and repayments of aggregates levy were overstated.

(6)In sub-paragraph (5) above “gross liability” means liability to aggregates levy before any deduction is made in respect of any entitlement to any tax credit or repayments of aggregates levy.

Conduct involving evasions or misstatements

3(1)A person is guilty of an offence under this paragraph if his conduct during any particular period must have involved the commission by him of one or more offences under the preceding provisions of this Schedule.

(2)For the purposes of any proceedings for an offence under this paragraph it shall be immaterial whether the particulars of the offence or offences that must have been committed are known.

(3)A person guilty of an offence under this paragraph shall be liable (subject to sub-paragraph (4) below)—

(a)on summary conviction, to a penalty of the statutory maximum or to imprisonment for a term not exceeding six months, or to both;

(b)on conviction on indictment, to a penalty of any amount or to imprisonment for a term not exceeding seven years, or to both.

(4)In the case of any offence under this paragraph, where the statutory maximum is less than three times the sum of the amounts of aggregates levy which are shown to be amounts that were or were intended to be evaded by the conduct in question, the penalty on summary conviction shall be the amount equal to three times that sum (instead of the statutory maximum).

(5)For the purposes of sub-paragraph (4) above the amounts of levy that were or were intended to be evaded by any conduct shall be taken to include—

(a)the amount of any tax credit, and

(b)the amount of any repayment of aggregates levy,

which was, or was intended to be, obtained in circumstances where there was no entitlement to it.

(6)In determining for the purposes of sub-paragraph (4) above how much aggregates levy (in addition to any amount falling within sub-paragraph (5) above) was or was intended to be evaded, no account shall be taken of the extent (if any) to which any liability to aggregates levy of any person fell, or would have fallen, to be reduced by the amount of any tax credit or repayments of aggregates levy to which he was, or would have been, entitled.

Preparations for evasion

4(1)Where a person—

(a)becomes a party to any agreement under or by means of which a quantity of taxable aggregate is or is to be subjected to commercial exploitation in the United Kingdom, or

(b)makes arrangements for any other person to become a party to such an agreement,

he is guilty of an offence if he does so in the belief that aggregates levy chargeable on the aggregate in question will be evaded.

(2)Subject to sub-paragraph (3) below, a person guilty of an offence under this paragraph shall be liable, on summary conviction, to a penalty of level 5 on the standard scale.

(3)In the case of any offence under this paragraph, where level 5 on the standard scale is less than three times the sum of the amounts of aggregates levy which are shown to be amounts that were or were intended to be evaded in respect of the aggregate in question, the penalty shall be the amount equal to three times that sum (instead of level 5 on the standard scale).

(4)For the purposes of sub-paragraph (3) above the amounts of levy that were or were intended to be evaded shall be taken to include—

(a)the amount of any tax credit, and

(b)the amount of any repayment of aggregates levy,

which was, or was intended to be, obtained in circumstances where there was no entitlement to it.

(5)In determining for the purposes of sub-paragraph (3) above how much aggregates levy (in addition to any amount falling within sub-paragraph (4) above) was or was intended to be evaded, no account shall be taken of the extent (if any) to which any liability to aggregates levy of any person fell, or would have fallen, to be reduced by the amount of any tax credit or repayments of aggregates levy to which he was, or would have been, entitled.

Criminal proceedings etc.

5Sections 145 to 155 of the Customs and Excise Management Act 1979 (c. 2) (proceedings for offences, mitigation of penalties and certain other matters) shall apply in relation to offences and penalties under this Part of this Schedule as they apply in relation to offences and penalties under the customs and excise Acts.

Arrest

6(1)Where an authorised person has reasonable grounds for suspecting that a fraud offence has been committed he may arrest anyone whom he has reasonable grounds for suspecting to be guilty of the offence.

(2)In this paragraph—

  • “authorised person” means any person acting under the authority of the Commissioners; and

  • “a fraud offence” means an offence under any of paragraphs 1 to 3 above.

Part 2Civil penalties

Evasion

7(1)Subject to sub-paragraph (5) below, where—

(a)any person engages in any conduct for the purpose of evading aggregates levy,

(b)at the time when that person engages in that conduct he is a person who is or is required to be registered, or would be so required but for an exemption by virtue of regulations under section 24(4) of this Act, and

(c)that conduct involves dishonesty (whether or not it is such as to give rise to criminal liability),

that person shall be liable to a penalty equal to the amount of the levy evaded, or (as the case may be) intended to be evaded, by his conduct.

(2)The references in sub-paragraph (1) above to evading aggregates levy include references to obtaining, in circumstances where there is no entitlement to it, either—

(a)a tax credit; or

(b)a repayment of aggregates levy.

(3)For the purposes of sub-paragraph (1) above the amount of levy that was or was intended to be evaded by any conduct shall be taken to include—

(a)the amount of any tax credit, and

(b)the amount of any repayment of aggregates levy,

which was, or was intended to be, obtained in circumstances where there was no entitlement to it.

(4)In determining for the purposes of sub-paragraph (1) above how much aggregates levy (in addition to any amount falling within sub-paragraph (3) above) was or was intended to be evaded, no account shall be taken of the extent (if any) to which any liability to aggregates levy of any person fell, or would have fallen, to be reduced by the amount of any tax credit or repayments of aggregates levy to which he was, or would have been, entitled.

(5)Where, by reason of conduct falling within sub-paragraph (1) above, a person is convicted of an offence (whether under this Act or otherwise) that person shall not by reason of that conduct be liable also to a penalty under this paragraph.

Liability of directors etc. for civil penalties

8(1)Where it appears to the Commissioners—

(a)that a body corporate is liable to a penalty under paragraph 7 above, and

(b)that the conduct giving rise to that penalty is, in whole or in part, attributable to the dishonesty of a person who is, or at the material time was, a director or managing officer of the body corporate (a “named officer”),

the Commissioners may serve a notice under this paragraph on the body corporate and on the named officer.

(2)A notice under this paragraph shall state—

(a)the amount of the penalty referred to in sub-paragraph (1)(a) above (“the basic penalty”); and

(b)that the Commissioners propose, in accordance with this paragraph, to recover from the named officer such portion of the basic penalty (which may be the whole of it) as is specified in the notice.

(3)Where a notice is served under this paragraph, the portion of the basic penalty specified in the notice shall be recoverable from the named officer as if he were personally liable under paragraph 7 above to a penalty which corresponds to that portion.

(4)Where a notice is served under this paragraph—

(a)the amount which may be assessed under Schedule 10 to this Act as the amount due by way of penalty from the body corporate shall be only so much (if any) of the basic penalty as is not assessed on and notified to a named officer; and

(b)the body corporate shall be treated as discharged from liability for so much of the basic penalty as is so assessed and notified.

(5)Subject to the following provisions of this paragraph, the giving of a notice under this paragraph as such shall not be a decision which may be reviewed under section 40 of this Act.

(6)Where a body corporate is assessed as mentioned in sub-paragraph (4)(a) above, the decisions of the Commissioners that may be reviewed in accordance with section 40 of this Act shall include their decision—

(a)as to the liability of the body corporate to a penalty; and

(b)as to the amount of the basic penalty that is specified in the assessment;

and sections 41 and 42 of this Act shall apply accordingly.

(7)Where an assessment is made on a named officer by virtue of this paragraph, the decisions which may be reviewed under section 40 of this Act at the request of the named officer shall include—

(a)the Commissioners' decisions in the case of the body corporate as to the matters mentioned in sub-paragraph (6)(a) and (b) above;

(b)their decision that the conduct of the body corporate referred to in sub-paragraph (1)(b) above is, in whole or in part, attributable to the dishonesty of the named officer; and

(c)their decision as to the portion of the penalty which the Commissioners propose to recover from him;

and sections 41 and 42 of this Act shall apply accordingly.

(8)In this paragraph a “managing officer”, in relation to a body corporate, means—

(a)any manager, secretary or other similar officer of the body corporate; or

(b)any person purporting to act in any such capacity or as a director.

(9)Where the affairs of a body corporate are managed by its members, this paragraph shall apply in relation to the conduct of a member in connection with his functions of management as if he were a director of the body corporate.

Misdeclaration or neglect

9(1)Subject to sub-paragraphs (3) to (5) below, where for an accounting period—

(a)a return is made which understates a person’s liability to aggregates levy or overstates his entitlement to any tax credit or repayment of aggregates levy, or

(b)at the end of the period of 30 days beginning on the date of the making of any assessment which understates a person’s liability to aggregates levy, that person has not taken all such steps as are reasonable to draw the understatement to the attention of the Commissioners,

the person concerned shall be liable to a penalty equal to 5 per cent. of the amount of the understatement of liability or (as the case may be) overstatement of entitlement.

(2)Where—

(a)a return for an accounting period—

(i)overstates or understates to any extent a person’s liability to aggregates levy, or

(ii)understates or overstates to any extent his entitlement to any tax credits or repayments of aggregates levy,

and

(b)that return is corrected—

(i)in such circumstances as may be prescribed by regulations made by the Commissioners, and

(ii)in accordance with such conditions as may be so prescribed,

by a return for a later accounting period which understates or overstates, to the corresponding extent, any liability or entitlement for the later period,

it shall be assumed for the purposes of this paragraph that the statement made by each such return is a correct statement for the accounting period to which the return relates.

(3)Conduct falling within sub-paragraph (1) above shall not give rise to liability to a penalty under this paragraph if the person concerned provides the Commissioners with full information with respect to the inaccuracy concerned—

(a)at a time when he has no reason to believe that enquiries are being made by the Commissioners into his affairs, so far as they relate to aggregates levy; and

(b)in such form and manner as may be prescribed by regulations made by the Commissioners or specified by them in accordance with any such regulations.

(4)Conduct falling within sub-paragraph (1) above shall not give rise to liability to a penalty under this paragraph if the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for his conduct.

(5)Where, by reason of conduct falling within sub-paragraph (1) above—

(a)a person is convicted of an offence (whether under this Act or otherwise), or

(b)a person is assessed to a penalty under paragraph 7 above,

that person shall not by reason of that conduct be liable also to a penalty under this paragraph.

Part 3Interpretation of Schedule

10(1)References in this Schedule to obtaining a tax credit are references to bringing an amount into account as a tax credit for the purposes of aggregates levy on the basis that that amount is an amount which may be so brought into account in accordance with tax credit regulations.

(2)References in this Schedule to obtaining a repayment of aggregates levy are references to obtaining either—

(a)the payment or repayment of any amount, or

(b)the acknowledgement of a right to receive any amount,

on the basis that that amount is the amount of a repayment of aggregates levy to which there is an entitlement.

Section 29.

SCHEDULE 7Aggregates levy: information and evidence etc

Provision of information

1(1)Every person involved (in whatever capacity) in subjecting any aggregate to exploitation in the United Kingdom, or in any connected activities, shall provide the Commissioners with such information relating to the matters in which he is or has been involved as the Commissioners may reasonably require.

(2)Information required under sub-paragraph (1) above shall be provided to the Commissioners within such period after being required, and in such form, as the Commissioners may reasonably require.

(3)Subject to sub-paragraphs (4) and (5) below and to paragraph 3(5) of Schedule 10 to this Act (which relates to supplementary assessments of daily penalties), if a person fails to provide information which he is required to provide under this paragraph, he shall be liable—

(a)to a penalty of £250; and

(b)to a further penalty of £20 for every day after the last relevant date and before the day after that on which the required information is provided.

(4)Liability to a penalty specified in sub-paragraph (3) above shall not arise if the person required to provide the information satisfies the Commissioners or, on appeal, an appeal tribunal—

(a)in the case of the penalty under paragraph (a) of that sub-paragraph that there is a reasonable excuse—

(i)for the initial failure to provide the required information on or before the last relevant date; and

(ii)for every subsequent failure to provide it;

and

(b)in the case of any penalty under paragraph (b) of that sub-paragraph for any day, that there is a reasonable excuse for the failure to provide the information on or before that day.

(5)Where, by reason of any failure by any person to provide information required under this paragraph—

(a)that person is convicted of an offence (whether under this Act or otherwise), or

(b)that person is assessed to a penalty under paragraph 7 of Schedule 6 to this Act (penalty for evasion),

that person shall not by reason of that failure be liable also to a penalty under this paragraph.

(6)In this paragraph “the last relevant date” means the last day of the period within which the person in question was required to provide the information.

Records

2(1)The Commissioners may by regulations impose obligations to keep records on persons who are or are required to be registered and on persons who would be so required but for an exemption by virtue of regulations under section 24(4) of this Act.

(2)Regulations under this paragraph may be framed by reference to such records as may be stipulated in any notice published by the Commissioners in pursuance of the regulations and not withdrawn by a further notice.

(3)Regulations under this paragraph may—

(a)require any records kept in pursuance of the regulations to be preserved for such period, not exceeding six years, as may be specified in the regulations;

(b)authorise the Commissioners to direct that any such records need only be preserved for a shorter period than that specified in the regulations;

(c)authorise a direction to be made so as to apply generally or in such cases as the Commissioners may stipulate.

(4)Any duty under regulations under this paragraph to preserve records may be discharged by the preservation of the information contained in them by such means as the Commissioners may approve.

(5)The Commissioners may, as a condition of approving under sub-paragraph (4) above any means of preserving information contained in any records, impose such reasonable requirements as appear to them necessary for securing that the information will be as readily available to them as if the records themselves had been preserved.

(6)Subject to sub-paragraphs (7) and (8) below, a person who fails to preserve any record in compliance with—

(a)any regulations under this paragraph, or

(b)any notice, direction or requirement given or imposed under such regulations,

shall be liable to a penalty of £250.

(7)A failure such as is mentioned in sub-paragraph (6) above shall not give rise to any penalty under that sub-paragraph if the person required to preserve the record satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the failure.

(8)Where, by reason of any such failure by any person as is mentioned in sub-paragraph (6) above—

(a)that person is convicted of an offence (whether under this Act or otherwise), or

(b)that person is assessed to a penalty under paragraph 7 of Schedule 6 to this Act (penalty for evasion),

that person shall not by reason of that failure be liable also to a penalty under this paragraph.

(9)The Commissioners may if they think fit at any time modify or withdraw any approval or requirement given or imposed for the purposes of this paragraph.

Evidence of records that are required to be preserved

3(1)Subject to the following provisions of this paragraph, where any obligation to preserve records is discharged in accordance with paragraph 2(4) above, a copy of any document forming part of the records shall be admissible in evidence in any proceedings, whether civil or criminal, to the same extent as the records themselves.

(2)A statement contained in a document produced by a computer shall not by virtue of this paragraph be admissible in evidence—

(a)in criminal proceedings in England and Wales, except in accordance with Part 2 of the Criminal Justice Act 1988 (c. 33);

(b)in civil proceedings in Scotland, except in accordance with sections 5 and 6 of the Civil Evidence (Scotland) Act 1988 (c. 32);

(c)in criminal proceedings in Scotland, except in accordance with Schedule 8 to the Criminal Procedure (Scotland) Act 1995 (c. 46); or

(d)in criminal proceedings in Northern Ireland, except in accordance with Part II of the Criminal Justice (Evidence, Etc.) (Northern Ireland) Order 1988 (S.I. 1988/1847 (N.I. 17)).

Production of documents

4(1)Every person involved (in whatever capacity) in subjecting any aggregate to exploitation in the United Kingdom, or in any connected activities, shall upon demand made by an authorised person produce or cause to be produced for inspection by that person any documents relating to the matters in which he is or has been involved.

(2)Where, by virtue of sub-paragraph (1) above, an authorised person has power to require the production of any documents from any person—

(a)he shall have the like power to require production of the documents concerned from any other person who appears to the authorised person to be in possession of them; and

(b)the production of any document by that other person in pursuance of a requirement under this sub-paragraph shall be without prejudice to any lien claimed by that other person on that document.

(3)The documents mentioned in sub-paragraphs (1) and (2) above shall be produced at such time and place as the authorised person may reasonably require.

(4)Subject to sub-paragraphs (5) and (6) below and to paragraph 3(5) of Schedule 10 to this Act (which relates to supplementary assessments of daily penalties), if a person fails to produce any document which he is required to produce under this paragraph, he shall be liable—

(a)to a penalty of £250; and

(b)to a further penalty of £20 for every day after the last relevant date and before the day after that on which the document is produced.

(5)Liability to a penalty specified in sub-paragraph (4) above shall not arise if the person required to produce the document in question satisfies the Commissioners or, on appeal, an appeal tribunal—

(a)in the case of the penalty under paragraph (a) of that sub-paragraph, that there is a reasonable excuse—

(i)for the initial failure to produce the document at the required time; and

(ii)for every subsequent failure to produce it;

and

(b)in the case of any penalty under paragraph (b) of that sub-paragraph for any day, that there is a reasonable excuse for the failure to produce the document on or before that day.

(6)Where, by reason of any failure by any person to provide information required under this paragraph—

(a)that person is convicted of an offence (whether under this Act or otherwise), or

(b)that person is assessed to a penalty under paragraph 7 of Schedule 6 to this Act (penalty for evasion),

that person shall not by reason of that failure be liable also to a penalty under this paragraph.

(7)In this paragraph “the last relevant date” means the last day of the period within which the person in question was required to produce the document.

Powers in relation to documents produced

5(1)An authorised person may take copies of, or make extracts from, any document produced under paragraph 4 above.

(2)If it appears to him to be necessary to do so, an authorised person may, at a reasonable time and for a reasonable period, remove any document produced under paragraph 4 above.

(3)An authorised person who removes any document under sub-paragraph (2) above shall, if requested to do so, provide a receipt for the document so removed.

(4)Where a lien is claimed on a document produced under paragraph 4(2) above, the removal of the document under sub-paragraph (2) above shall not be regarded as breaking the lien.

(5)Where a document removed by an authorised person under sub-paragraph (2) above is reasonably required for any purpose he shall, as soon as practicable, provide a copy of the document, free of charge, to the person by whom it was produced or caused to be produced.

(6)Where any documents removed under the powers conferred by this paragraph are lost or damaged, the Commissioners shall be liable to compensate their owner for any expenses reasonably incurred by him in replacing or repairing the documents.

Entry and inspection

6For the purpose of exercising any powers under this Part of this Act an authorised person may at any reasonable time enter and inspect premises used in connection with the carrying on of a business.

Entry and search

7(1)Where—

(a)a justice of the peace is satisfied on information on oath that there is reasonable ground for suspecting that a fraud offence which appears to be of a serious nature is being, has been or is about to be committed on any premises or that evidence of the commission of such an offence is to be found there, or

(b)in Scotland a justice (within the meaning of section 307 of the Criminal Procedure (Scotland) Act 1995 (c. 46)) is satisfied by evidence on oath as mentioned in paragraph (a) above,

he may issue a warrant in writing authorising any authorised person to enter those premises, if necessary by force, at any time within one month from the time of the issue of the warrant and to search them.

(2)A person who enters the premises under the authority of the warrant may—

(a)take with him such other persons as appear to him to be necessary;

(b)seize and remove any such documents or other things at all found on the premises as he has reasonable cause to believe may be required as evidence for the purposes of proceedings in respect of a fraud offence which appears to him to be of a serious nature;

(c)search, or cause to be searched, any person found on the premises whom he has reasonable cause to believe to be in possession of any documents or other things which may be so required.

(3)Sub-paragraph (2) above shall not authorise any person to be searched by a member of the opposite sex.

(4)The powers conferred by a warrant under this paragraph shall not be exercisable—

(a)by more than such number of authorised persons as may be specified in the warrant;

(b)outside such periods of the day as may be so specified; or

(c)if the warrant so provides, otherwise than in the presence of a constable in uniform.

(5)An authorised person seeking to exercise the powers conferred by a warrant under this paragraph or, if there is more than one such authorised person, such one of them as is in charge of the search shall provide a copy of the warrant endorsed with his name as follows—

(a)if the occupier of the premises concerned is present at the time the search is to begin, the copy shall be supplied to the occupier;

(b)if at that time the occupier is not present but a person who appears to the authorised person to be in charge of the premises is present, the copy shall be supplied to that person;

(c)if neither paragraph (a) nor paragraph (b) above applies, the copy shall be left in a prominent place on the premises.

(6)In this paragraph “a fraud offence” means an offence under any of paragraphs 1 to 3 of Schedule 6 to this Act.

Order for access to recorded information etc.

8(1)Where, on an application by an authorised person, a justice of the peace or, in Scotland, a justice (within the meaning of section 307 of the Criminal Procedure (Scotland) Act 1995 (c. 46)) is satisfied that there are reasonable grounds for believing—

(a)that an offence in connection with aggregates levy is being, has been or is about to be committed, and

(b)that any recorded information (including any document of any nature at all) which may be required as evidence for the purpose of any proceedings in respect of such an offence is in the possession of any person,

he may make an order under this paragraph.

(2)An order under this paragraph is an order that the person who appears to the justice to be in possession of the recorded information to which the application relates shall—

(a)give an authorised person access to it, and

(b)permit an authorised person to remove and take away any of it which he reasonably considers necessary,

not later than the end of the period of seven days beginning with the date of the order, or the end of such longer period as the order may specify.

(3)The reference in sub-paragraph (2)(a) above to giving an authorised person access to the recorded information to which the application relates includes a reference to permitting the authorised person to take copies of it or to make extracts from it.

(4)Where the recorded information consists of information contained in a computer, an order under this paragraph shall have effect as an order to produce the information—

(a)in a form in which it is visible and legible; and

(b)if the authorised person wishes to remove it, in a form in which it can be removed.

(5)This paragraph is without prejudice to the preceding paragraphs of this Schedule.

Removal of documents etc.

9(1)An authorised person who removes anything in the exercise of a power conferred by or under paragraph 7 or 8 above shall, if so requested by a person showing himself—

(a)to be the occupier of premises from which it was removed, or

(b)to have had custody or control of it immediately before the removal,

provide that person with a record of what he removed.

(2)The authorised person shall provide the record within a reasonable time from the making of the request for it.

(3)Subject to sub-paragraph (7) below, if a request for permission to be allowed access to anything which—

(a)has been removed by an authorised person, and

(b)is retained by the Commissioners for the purposes of investigating an offence,

is made to the officer in overall charge of the investigation by a person who had custody or control of the thing immediately before it was so removed, or by someone acting on behalf of such a person, the officer shall allow the person who made the request access to it under the supervision of an authorised person.

(4)Subject to sub-paragraph (7) below, if a request for a photograph or copy of any such thing is made to the officer in overall charge of the investigation by a person who had custody or control of the thing immediately before it was so removed, or by someone acting on behalf of such a person, the officer shall—

(a)allow the person who made the request access to it under the supervision of an authorised person for the purpose of photographing it or copying it; or

(b)photograph or copy it, or cause it to be photographed or copied.

(5)Subject to sub-paragraph (7) below, where anything is photographed or copied under sub-paragraph (4)(b) above, the officer shall supply the photograph or copy, or cause it to be supplied, to the person who made the request.

(6)The photograph or copy shall be supplied within a reasonable time from the making of the request.

(7)There is no duty under this paragraph to allow access to anything, or to supply a photograph or copy of anything, if the officer in overall charge of the investigation for the purposes of which it was removed has reasonable grounds for believing that to do so would prejudice—

(a)that investigation;

(b)the investigation of an offence other than the offence for the purposes of the investigation of which the thing was removed; or

(c)any criminal proceedings which may be brought as a result of the investigation of which he is in charge or any such investigation as is mentioned in paragraph (b) above.

(8)Any reference in this paragraph to the officer in overall charge of the investigation is a reference to the person whose name and address are endorsed on the warrant concerned as being the officer so in charge.

Enforcement of paragraph 9

10(1)Where, on an application made as mentioned in sub-paragraph (2) below, the appropriate judicial authority is satisfied that a person has failed to comply with a requirement imposed by paragraph 9 above, the authority may order that person to comply with the requirement within such time and in such manner as may be specified in the order.

(2)An application under sub-paragraph (1) above shall not be made except—

(a)in the case of a failure to comply with any of the requirements imposed by paragraph 9(1) and (2) above—

(i)by the occupier of the premises from which the thing in question was removed; or

(ii)by the person who had custody or control of it immediately before it was so removed;

(b)in any other case, by the person who had such custody or control.

(3)In this paragraph “the appropriate judicial authority” means—

(a)in England and Wales, a magistrates' court;

(b)in Scotland, the sheriff;

(c)in Northern Ireland, a court of summary jurisdiction, as defined in Article 2(2)(a) of the Magistrates' Courts (Northern Ireland) Order 1981 (S.I. 1981/1675 (N.I. 26)) .

(4)In England and Wales and Northern Ireland, an application for an order under this paragraph shall be made by way of complaint; and sections 21 and 42(2) of the InterpretationAct (Northern Ireland) 1954 (c. 33 (N.I.)) shall apply as if any reference in those provisions to any enactment included a reference to this paragraph.

Power to take samples

11(1)An authorised person, if it appears to him necessary for the protection of the revenue against mistake or fraud, may at any time take, from material which he has reasonable cause to believe is aggregate which is intended to be, is being, or has been subjected to exploitation in the United Kingdom, such samples as he may require with a view to determining how the material ought to be treated, or to have been treated, for the purposes of aggregates levy.

(2)Any sample taken under this paragraph shall be disposed of in such manner as the Commissioners may direct.

Evidence by certificate

12(1)In any proceedings a certificate of the Commissioners—

(a)that a person was or was not at any time registered,

(b)that any return required by regulations made under section 25 of this Act has not been made or had not been made at any time,

(c)that any levy shown as due in a return made in pursuance of regulations made under section 25 of this Act has not been paid, or

(d)that any amount shown as due in any assessment made under this Part of this Act has not been paid,

shall be evidence or, in Scotland, sufficient evidence of that fact.

(2)A photograph of any document provided to the Commissioners for the purposes of this Part of this Act and certified by them to be such a photograph shall be admissible in any proceedings, whether civil or criminal, to the same extent as the document itself.

(3)In any proceedings any document purporting to be a certificate under sub-paragraph (1) or (2) above shall be taken to be such a certificate unless the contrary is shown.

Inducements to provide information

13(1)This paragraph applies—

(a)to any criminal proceedings against a person in respect of an offence in connection with or in relation to aggregates levy; and

(b)to any proceedings against a person for the recovery of any sum due from him in connection with or in relation to that levy.

(2)Statements made or documents produced or provided by or on behalf of a person shall not be inadmissible in any proceedings to which this paragraph applies by reason only that—

(a)a matter falling within sub-paragraph (3) or (4) below has been drawn to that person’s attention; and

(b)he was or may have been induced, as a result, to make the statements or to produce or provide the documents.

(3)The matters falling within this sub-paragraph are—

(a)that, in relation to aggregates levy, the Commissioners may assess an amount due by way of a civil penalty instead of instituting criminal proceedings;

(b)that it is the practice of the Commissioners (without giving any undertaking as to whether they will make such an assessment in any case) to be influenced by whether a person—

(i)has made a full confession of any dishonest conduct to which he has been a party; and

(ii)has otherwise co-operated to the full with any investigation.

(4)The matter falling within this sub-paragraph is the fact that the Commissioners or, on appeal, an appeal tribunal have power under any provision of this Part of this Act to reduce a penalty.

Disclosure of information

14(1)Notwithstanding any obligation not to disclose information that would otherwise apply but subject to sub-paragraph (2) below, the Commissioners may disclose any information obtained or held by them in or in connection with the carrying out of their functions in relation to aggregates levy to any of the following—

(a)any Minister of the Crown;

(b)the Scottish Ministers;

(c)any Minister, within the meaning of the Northern Ireland Act 1998 (c. 47), or any Northern Ireland department;

(d)the National Assembly for Wales;

(e)the Environment Agency;

(f)the Scottish Environment Protection Agency;

(g)a mineral planning authority in England and Wales (within the meaning of the Town and Country Planning Act 1990 (c. 8));

(h)a planning authority in Scotland;

(i)a district council in Northern Ireland;

(j)an authorised officer of any person mentioned in paragraphs (a) to (i) above.

(2)Information shall not be disclosed under sub-paragraph (1) above except for the purpose of assisting a person falling within paragraphs (a) to (j) of that sub-paragraph in the performance of his duties.

(3)Notwithstanding any such obligation as is mentioned in sub-paragraph (1) above, any person mentioned in sub-paragraph (1)(a) to (j) above may disclose information—

(a)to the Commissioners, or

(b)to an authorised officer of the Commissioners,

for the purpose of assisting the Commissioners in the performance of duties in relation to aggregates levy.

(4)Information that has been disclosed to a person by virtue of this paragraph shall not be disclosed by him except—

(a)to another person to whom (instead of him) disclosure could by virtue of this paragraph have been made; or

(b)for the purpose of any proceedings connected with the operation of any provision made by or under any enactment relating to the environment or to aggregates levy.

(5)References in the preceding provisions of this paragraph to an authorised officer of any person (“the principal”) are to any person who has been designated by the principal as a person to and by whom information may be disclosed by virtue of this paragraph.

(6)Where the principal is a person falling within any of paragraphs (a) to (c) above, the principal shall notify the Commissioners in writing of the name of any person designated by the principal for the purposes of this paragraph.

(7)No charge may be made for any disclosure made by virtue of this paragraph.

(8)In this paragraph “enactment” includes an enactment contained in an Act of the Scottish Parliament or in any Northern Ireland legislation.

Interpretation of Schedule

15In this Schedule—

  • “authorised person” means any person acting under the authority of the Commissioners;

  • “connected activities”, in relation to the exploitation of aggregate in the United Kingdom, means any activities carried out—

    (a)

    for purposes connected with the carrying out of any such exploitation or with any transaction involving the carrying out of any such exploitation; or

    (b)

    for the purposes of, in connection with or in relation to the carrying on of any business involving any such exploitation.

Section 32.

SCHEDULE 8Aggregates levy: repayments and credits

Reimbursement arrangements

1(1)The Commissioners may by regulations make provision for reimbursement arrangements made by any person to be disregarded for the purposes of section 32(2) of this Act except where the arrangements—

(a)contain such provision as may be required by the regulations; and

(b)are supported by such undertakings to comply with the provisions of the arrangements as may be required by the regulations to be given to the Commissioners.

(2)In this paragraph “reimbursement arrangements” means any arrangements for the purposes of a claim to a repayment of aggregates levy which—

(a)are made by any person for the purpose of securing that he is not unjustly enriched by the repayment of any amount in pursuance of the claim; and

(b)provide for the reimbursement of persons who have for practical purposes borne the whole or any part of the cost of the original payment of that amount to the Commissioners.

(3)Without prejudice to the generality of sub-paragraph (1) above, the provision that may be required by regulations under this paragraph to be contained in reimbursement arrangements includes—

(a)provision requiring a reimbursement for which the arrangements provide to be made within such period after the repayment to which it relates as may be specified in the regulations;

(b)provision for the repayment of amounts to the Commissioners where those amounts are not reimbursed in accordance with the arrangements;

(c)provision requiring interest paid by the Commissioners on any amount repaid by them to be treated in the same way as that amount for the purposes of any requirement under the arrangements to make reimbursement or to repay the Commissioners;

(d)provision requiring such records relating to the carrying out of the arrangements as may be described in the regulations to be kept and produced to the Commissioners, or to an officer of theirs.

(4)Regulations under this paragraph may impose obligations on such persons as may be specified in the regulations—

(a)to make the repayments to the Commissioners that they are required to make in pursuance of any provisions contained in any reimbursement arrangements by virtue of sub-paragraph (3)(b) or (c) above;

(b)to comply with any requirements contained in any such arrangements by virtue of sub-paragraph (3)(d) above.

(5)Regulations under this paragraph may make provision for the form and manner in which, and the times at which, undertakings are to be given to the Commissioners in accordance with the regulations; and any such provision may allow for those matters to be determined by the Commissioners in accordance with the regulations.

Interest payable by the Commissioners

2(1)Where, due to an error on the part of the Commissioners, a person—

(a)has paid to them by way of aggregates levy an amount which was not levy due and which they are in consequence liable to repay to him,

(b)has failed to claim a repayment of levy to which he was entitled, under tax credit regulations, in respect of any tax credits, or

(c)has suffered delay in receiving payment of an amount due to him from them in connection with aggregates levy,

then, if and to the extent that they would not be liable to do so apart from this paragraph, they shall (subject to the following provisions of this paragraph) pay interest to him on that amount for the applicable period.

(2)In sub-paragraph (1) above, the reference in paragraph (a) to an amount which the Commissioners are liable to repay in consequence of the making of a payment that was not due is a reference to only so much of that amount as is the subject of a claim that the Commissioners are required to satisfy or have satisfied.

(3)In that sub-paragraph the amounts referred to in paragraph (c)—

(a)do not include any amount payable under this paragraph;

(b)do not include the amount of any interest for which provision is made by virtue of section 30(3)(f) of this Act; but

(c)do include any amount due (in respect of an adjustment of overpaid interest) by way of a repayment under—

(i)paragraph 11(3) of Schedule 5 to this Act; or

(ii)paragraph 6(3) of Schedule 10 to this Act.

(4)The applicable period, in a case falling within sub-paragraph (1)(a) above, is the period—

(a)beginning with the date on which the payment is received by the Commissioners; and

(b)ending with the date on which they authorise payment of the amount on which the interest is payable.

(5)The applicable period, in a case falling within sub-paragraph (1)(b) or (c) above, is the period—

(a)beginning with the date on which, apart from the error, the Commissioners might reasonably have been expected to authorise payment of the amount on which the interest is payable; and

(b)ending with the date on which they in fact authorise payment of that amount.

(6)In determining the applicable period for the purposes of this paragraph there shall be left out of account any period by which the Commissioners' authorisation of the payment of interest is delayed by circumstances beyond their control.

(7)The reference in sub-paragraph (6) above to a period by which the Commissioners' authorisation of the payment of interest is delayed by circumstances beyond their control includes, in particular, any period which is referable to—

(a)any unreasonable delay in the making of any claim for the payment or repayment of the amount on which interest is claimed;

(b)any failure by any person to provide the Commissioners—

(i)at or before the time of the making of a claim, or

(ii)subsequently in response to a request for information by the Commissioners,

with all the information required by them to enable the existence and amount of the claimant’s entitlement to a payment or repayment to be determined; and

(c)the making, as part of or in association with any claim for the payment or repayment of the amount on which interest is claimed, of a claim to anything to which the claimant was not entitled.

(8)In determining for the purposes of sub-paragraph (7) above whether any period of delay is referable to a failure by any person to provide information in response to a request by the Commissioners, there shall be taken to be so referable, except so far as may be provided for by regulations, any period which—

(a)begins with the date on which the Commissioners require that person to provide information which they reasonably consider relevant to the matter to be determined; and

(b)ends with the earliest date on which it would be reasonable for the Commissioners to conclude—

(i)that they have received a complete answer to their request for information;

(ii)that they have received all that they need in answer to that request; or

(iii)that it is unnecessary for them to be provided with any information in answer to that request.

(9)The Commissioners shall not be liable to pay interest under this paragraph except on the making of a claim for that purpose.

(10)A claim under this paragraph must be in writing and must be made not more than three years after the end of the applicable period to which it relates.

(11)References in this paragraph—

(a)to receiving payment of any amount from the Commissioners, or

(b)to the authorisation by the Commissioners of the payment of any amount,

include references to the discharge by way of set-off (whether in accordance with regulations under paragraph 9 or 10 below or otherwise) of the Commissioners' liability to pay that amount.

(12)Interest under this paragraph shall be payable at the rate applicable under section 197 of the Finance Act 1996 (c. 8).

Assessment for excessive repayment

3(1)Where—

(a)any amount has been paid at any time to any person by way of a repayment of aggregates levy, and

(b)the amount paid exceeded the amount which the Commissioners were liable at that time to repay to that person,

the Commissioners may, to the best of their judgement, assess the excess paid to that person and notify it to him.

(2)Where—

(a)any amount has been paid to any person by way of repayment of levy,

(b)the repayment is in respect of a tax credit the entitlement to which arose in a case falling within section 30(1)(e) (bad debts),

(c)the whole or any part of the credit is withdrawn on account of the payment of the whole or any part of the debt taken as bad,

(d)the amount of the repayment exceeded the amount which the Commissioners would have been liable to repay had the withdrawal taken place before the determination of the amount of the repayment,

the Commissioners may, to the best of their judgement, assess the excess repaid to that person and notify it to him.

(3)Where any person is liable to pay any amount to the Commissioners in pursuance of an obligation imposed by virtue of paragraph 1(4)(a) above, the Commissioners may, to the best of their judgement, assess the amount due from that person and notify it to him.

(4)Subject to sub-paragraph (5) below, where—

(a)an assessment is made on any person under this paragraph in respect of a repayment of levy made in relation to any accounting period, and

(b)the Commissioners have power under Schedule 5 to this Act to make an assessment on that person to an amount of aggregates levy due from that person for that period,

the assessments may be combined and notified to him as one assessment.

(5)A notice of a combined assessment under sub-paragraph (4) above must separately identify the amount being assessed in respect of repayments of levy.

Assessment for overpayments of interest

4Where—

(a)any amount has been paid to any person by way of interest under paragraph 2 above, but

(b)that person was not entitled to that amount under that paragraph,

the Commissioners may, to the best of their judgement, assess the amount so paid to which that person was not entitled and notify it to him.

Assessments under paragraphs 3 and 4

5(1)An assessment under paragraph 3 or 4 above shall not be made more than two years after the time when evidence of facts sufficient in the opinion of the Commissioners to justify the making of the assessment comes to the knowledge of the Commissioners.

(2)Where an amount has been assessed and notified to any person under paragraph 3 or 4 above, it shall be recoverable as if it were aggregates levy due from him.

(3)Sub-paragraph (2) above does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.

Interest on amounts assessed

6(1)Where an assessment is made under paragraph 3 or 4 above, the whole of the amount assessed shall carry interest, for the period specified in sub-paragraph (2) below, as follows—

(a)so much of that amount as represents the amount of a tax credit claimed by a person who was not entitled to it shall carry penalty interest; and

(b)so much of that amount as does not carry penalty interest under paragraph (a) above shall carry interest at the rate applicable under section 197 of the Finance Act 1996 (c. 8).

(2)That period is the period which—

(a)begins with the day after that on which the person is notified of the assessment; and

(b)ends with the day before that on which payment is made of the amount assessed.

(3)Interest under this paragraph shall be paid without any deduction of income tax.

(4)Penalty interest under this paragraph shall be compound interest calculated—

(a)at the penalty rate; and

(b)with monthly rests.

(5)For this purpose the penalty rate is the rate found by—

(a)taking the rate applicable under section 197 of the Finance Act 1996 for the purposes of sub-paragraph (1)(b) above; and

(b)adding 10 percentage points to that rate.

(6)Where a person is liable under this paragraph to pay any penalty interest, the Commissioners or, on appeal, an appeal tribunal may reduce the amount payable to such amount (including nil) as they think proper.

(7)Subject to sub-paragraph (8) below, where the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the conduct giving rise to the liability to pay penalty interest, that is a matter which (among other things) may be taken into account under sub-paragraph (6) above.

(8)In determining whether there is a reasonable excuse for the purposes of sub-paragraph (7) above, no account shall be taken of any of the following matters, that is to say—

(a)the insufficiency of the funds available to any person for paying any aggregates levy due or for paying the amount of the interest;

(b)the fact that there has, in the case in question or in that case taken with any other cases, been no or no significant loss of aggregates levy;

(c)the fact that the person liable to pay the interest or a person acting on his behalf has acted in good faith.

(9)In the case of interest reduced by the Commissioners under sub-paragraph (6) above an appeal tribunal, on an appeal relating to the interest, may cancel the whole or any part of the reduction made by the Commissioners.

Assessments to interest under paragraph 6

7(1)Where any person is liable to interest under paragraph 6 above the Commissioners may assess the amount due by way of interest and notify it to him accordingly.

(2)Without prejudice to the power to make assessments under this paragraph for later periods, the interest to which an assessment under this paragraph may relate shall be confined to interest for a period of no more than two years ending with the time when the assessment under this paragraph is made.

(3)Where an amount has been assessed and notified to any person under this paragraph it shall be recoverable as if it were aggregates levy due from him.

(4)Sub-paragraph (3) above does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.

(5)Where an assessment is made under this paragraph to an amount of interest under paragraph 6 above—

(a)the notice of assessment shall specify a date, not later than the date of the notice of assessment, to which the amount of interest which is assessed is calculated; and

(b)if the interest continues to accrue after that date, a further assessment or further assessments may be made under this paragraph in respect of the amounts so accruing.

(6)Where—

(a)an assessment to interest is made specifying a date for the purposes of sub-paragraph (5)(a) above, and

(b)within such period as may for the purposes of this sub-paragraph have been notified by the Commissioners to the person liable for the interest, the amount on which the interest is payable is paid,

that amount shall be deemed for the purposes of any further liability to interest to have been paid on the specified date.

Supplementary assessments

8If it appears to the Commissioners that the amount which ought to have been assessed in an assessment under paragraph 3, 4 or 7 above exceeds the amount which was so assessed, then—

(a)under the same paragraph as that assessment was made, and

(b)on or before the last day on which that assessment could have been made,

the Commissioners may make a supplementary assessment of the amount of the excess and notify the person concerned accordingly.

Set-off of or against amounts due under this Part of this Act

9(1)The Commissioners may by regulations make provision in relation to any case where—

(a)a person is under a duty to pay to the Commissioners at any time an amount or amounts in respect of aggregates levy; and

(b)the Commissioners are under a duty to pay to that person at the same time an amount or amounts in respect of that levy or any of the other taxes under their care and management.

(2)Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) above exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(b) above, the latter shall be set off against the former.

(3)Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(b) above exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(a) above, the Commissioners may set off the latter in paying the former.

(4)Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) above is the same as the total of the amount or amounts mentioned in sub-paragraph (1)(b) above no payment need be made in respect of the former or the latter.

(5)Regulations under this paragraph may provide for any limitation on the time within which the Commissioners are entitled to take steps for recovering any amount due to them in respect of aggregates levy to be disregarded, in such cases as may be described in the regulations, in determining whether any person is under such a duty to pay as is mentioned in sub-paragraph (1)(a) above.

(6)Regulations under this paragraph may include provision treating any duty to pay mentioned in sub-paragraph (1) above as discharged accordingly.

(7)References in sub-paragraph (1) above to an amount in respect of a particular tax include references not only to an amount of tax itself but also to other amounts such as interest and penalties that are or may be recovered as if they were amounts of tax.

(8)In this paragraph “tax” includes levy or duty.

Set-off of or against other taxes and duties

10(1)The Commissioners may by regulations make provision in relation to any case where—

(a)a person is under a duty to pay to the Commissioners at any time an amount or amounts in respect of any tax (or taxes) under their care and management other than aggregates levy; and

(b)the Commissioners are under a duty, at the same time, to make any repayment of aggregates levy to that person or to make any other payment to him of any amount or amounts in respect of aggregates levy.

(2)Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) above exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(b) above, the latter shall be set off against the former.

(3)Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(b) above exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(a) above, the Commissioners may set off the latter in paying the former.

(4)Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) above is the same as the total of the amount or amounts mentioned in sub-paragraph (1)(b) above no payment need be made in respect of the former or the latter.

(5)Regulations under this paragraph may provide for any limitation on the time within which the Commissioners are entitled to take steps for recovering any amount due to them in respect of any of the taxes under their care and management to be disregarded, in such cases as may be described in the regulations, in determining whether any person is under such a duty to pay as is mentioned in sub-paragraph (1)(a) above.

(6)Regulations under this paragraph may include provision treating any duty to pay mentioned in sub-paragraph (1) above as discharged accordingly.

(7)References in sub-paragraph (1) above to an amount in respect of a particular tax include references not only to an amount of tax itself but also to other amounts such as interest and penalties that are or may be recovered as if they were amounts of tax.

(8)In this paragraph “tax” includes levy or duty.

Restriction on powers to provide for set-off

11(1)Regulations made under paragraph 9 or 10 above shall not require any such amount or amounts as are mentioned in sub-paragraph (1)(b) of that paragraph (“the credit”) to be set against any such amount or amounts as are mentioned in sub-paragraph (1)(a) of that paragraph (“the debit”) in any case where—

(a)an insolvency procedure has been applied to the person entitled to the credit;

(b)the credit became due after that procedure was so applied; and

(c)the liability to pay the debit either arose before that procedure was so applied or (having arisen afterwards) relates to, or to matters occurring in the course of, the carrying on of any business at times before the procedure was so applied.

(2)For the purposes of this paragraph, an insolvency procedure is applied to a person if—

(a)a bankruptcy order, winding-up order or administration order is made in relation to that person or an award of sequestration is made on that person’s estate;

(b)that person is put into administrative receivership;

(c)that person passes a resolution for voluntary winding up;

(d)any voluntary arrangement approved in accordance with—

(i)Part 1 or 8 of the Insolvency Act 1986 (c. 45), or

(ii)Part II or Chapter II of Part VIII of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)) ,

comes into force in relation to that person;

(e)a deed of arrangement registered in accordance with—

(i)the Deeds of Arrangement Act 1914 (c. 47), or

(ii)Chapter I of Part VIII of that Order,

takes effect in relation to that person;

(f)a person is appointed as the interim receiver of some or all of that person’s property under section 286 of the Insolvency Act 1986 or Article 259 of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19));

(g)a person is appointed as the provisional liquidator in relation to that person under section 135 of that Act or Article 115 of that Order;

(h)an interim order is made under Part 8 of that Act, or Chapter I of Part VIII of that Order, in relation to that person; or

(i)that person’s estate becomes vested in any other person as that person’s trustee under a trust deed (within the meaning of the Bankruptcy (Scotland) Act 1985 (c. 66)).

(3)In this paragraph references, in relation to any person, to the application of an insolvency procedure to that person shall not include—

(a)the making of a bankruptcy order, winding-up order, administration order or award of sequestration at a time when any such arrangement or deed as is mentioned in paragraph (d), (e) or (i) of sub-paragraph (2) above is in force in relation to that person;

(b)the making of a winding-up order at any of the following times, that is to say—

(i)immediately upon the discharge of an administration order made in relation to that person;

(ii)when that person is being wound up voluntarily;

(iii)when that person is in administrative receivership;

or

(c)the making of an administration order in relation to that person at any time when that person is in administrative receivership.

(4)For the purposes of this paragraph a person shall be regarded as being in administrative receivership throughout any continuous period for which (disregarding any temporary vacancy in the office of receiver) there is an administrative receiver of that person.

(5)In this paragraph—

  • “administration order” means an administration order under section 8 of the Insolvency Act 1986 (c. 45) or Article 21 of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)) ;

  • “administrative receiver” means an administrative receiver within the meaning of section 251 of that Act of 1986 or Article 5(1) of that Order of 1989.

Supplemental provisions of Schedule

12(1)Any notification of an assessment under any provision of this Schedule to a person’s representative shall be treated for the purposes of this Part of this Act as notification to the person in relation to whom the representative acts.

(2)In this paragraph “representative”, in relation to any person, means—

(a)any of that person’s personal representatives;

(b)that person’s trustee in bankruptcy or liquidator;

(c)any person holding office as a receiver in relation to that person or any of his property;

(d)that person’s tax representative or any other person for the time being acting in a representative capacity in relation to that person.

(3)In this paragraph “trustee in bankruptcy” includes, as respects Scotland—

(a)an interim or permanent trustee (within the meaning of the Bankruptcy (Scotland) Act 1985); and

(b)a trustee acting under a trust deed (within the meaning of that Act).

(4)The powers conferred by paragraphs 9 and 10 of this Schedule are without prejudice to any power of the Commissioners to provide by tax credit regulations for any amount to be set against another.

Section 35.

SCHEDULE 9Aggregates levy: group treatment

Eligibility for group treatment

1Two or more bodies corporate are eligible to be treated as members of a group for the purposes of this Part of this Act if—

(a)each of them has an established place of business in the United Kingdom; and

(b)they are all under the same control.

Application for group treatment

2(1)Subject to sub-paragraph (3) below, where an application is made to the Commissioners with respect to two or more bodies corporate and those bodies are all eligible to be treated as members of the same group, then, from the specified time—

(a)they shall be so treated for the purposes of this Part of this Act; and

(b)such one of them as is specified in the application shall be the representative member.

(2)Subject to sub-paragraph (3) below, where—

(a)any bodies corporate are treated as members of a group for the purposes of this Part of this Act, and

(b)an application is made to the Commissioners for the addition to the group of a body corporate that is eligible to be treated as a member of the group,

then, from the specified time, that body shall be included among the bodies so treated.

(3)The Commissioners may refuse an application under sub-paragraph (1) or (2) above if, and only if, it appears to them necessary to do so for the protection of the revenue; and an application that is refused under this sub-paragraph shall be, and be treated as always having been, ineffective.

(4)Where—

(a)it appears to the Commissioners that an application has been made for the purposes of this paragraph for a body corporate to be treated as a member of a group, but

(b)that body is not eligible to be treated as a member of that group,

the Commissioners shall give notice to the applicant that the application is ineffective.

(5)The Commissioners shall not refuse an application under sub-paragraph (3) above after the end of the period of ninety days beginning with the day on which the application is received by the Commissioners.

Modification of group treatment

3(1)Subject to sub-paragraph (2) below, where any bodies corporate are treated as members of a group for the purposes of this Part of this Act and an application for the purpose is made to the Commissioners, then, from the specified time—

(a)a body corporate shall be excluded from the bodies so treated;

(b)one of those bodies corporate shall be substituted for another body corporate as the representative member; or

(c)the bodies corporate shall no longer be treated as members of a group.

(2)The Commissioners may refuse an application made for the purpose mentioned in sub-paragraph (1)(a) or (c) above if, and only if—

(a)the case is not one appearing to them to fall within paragraph 4(2)(a) and (b) below; and

(b)it appears to them necessary to refuse the application for the protection of the revenue.

(3)The Commissioners may refuse an application made for the purpose mentioned in sub-paragraph (1)(b) above if, and only if, it appears to them necessary to do so for the protection of the revenue.

(4)An application that is refused under this paragraph shall be, and be treated as always having been, ineffective.

(5)The specified time for the purposes of an application under sub-paragraph (1) above shall not be before the beginning of the accounting period which is current when the application is made.

Termination of group treatment

4(1)If it appears to the Commissioners necessary to do so for the protection of the revenue, the Commissioners may, by notice given to any body corporate that is treated as a member of a group and to the representative member, terminate that treatment from such time as may be specified in the notice.

(2)Where—

(a)a body corporate is treated as a member of a group, and

(b)it appears to the Commissioners that it is not eligible to be treated as a member of that group,

they shall, by notice given to the body corporate and the representative member, terminate that treatment from such time as may be specified in the notice.

(3)Where—

(a)a body corporate ceases as from any time to be treated as a member of a group,

(b)immediately before that time that body was the representative member,

(c)there are two or more other bodies corporate which will continue after that time to be treated as members of the group, and

(d)none of those bodies corporate is substituted from that time, or from before that time, as the representative member of the group under paragraph 3(1)(b) above,

the Commissioners shall, by notice given to such one of the bodies corporate mentioned in paragraph (c) above as they think fit, substitute that body corporate as the representative member as from that time.

(4)The time specified in a notice under sub-paragraph (1) above shall not be a time before the day on which the notice is given to the representative member.

(5)Subject to sub-paragraph (6) below, the time specified in a notice under sub-paragraph (2) or (3) above may be a time before the giving of the notice.

(6)In the case of a notice given under sub-paragraph (2) above in respect of a body corporate’s having ceased to be eligible to be treated as a member of a group, the time specified in the notice shall not be before the time when it so ceased.

Applications relating to group treatment

5An application under this Schedule with respect to any bodies corporate must be made by one of those bodies or by the person controlling them.

Notifications relating to group treatment

6(1)Where—

(a)two or more bodies corporate are treated as members of a group for the purposes of this Part of this Act, and

(b)any of those bodies ceases to be eligible to be so treated,

the body corporate which ceases to be so eligible shall notify the Commissioners of that fact.

(2)A body corporate which is designated as representative member in relation to any other bodies corporate shall not cease to have an established place of business in the United Kingdom without first notifying the Commissioners of that fact.

(3)A body corporate which fails to comply with sub-paragraph (1) or (2) above shall be liable to a penalty of £250.

Supplemental regulations about applications and notifications

7(1)For the purposes of any provision made by or under this Schedule for an application to be made to the Commissioners, regulations made by the Commissioners may make provision—

(a)as to the time within which the application is to be made;

(b)as to the form and manner in which the application is to be made;

(c)as to the information and other particulars to be contained in or provided with any application.

(2)For those purposes the Commissioners may also by regulations impose obligations requiring a person who has made an application to notify the Commissioners if any information contained in or provided in connection with that application is or becomes inaccurate.

(3)The power under this paragraph to make regulations as to the time within which any application is to be made shall include power to authorise the Commissioners to extend the time for the making of an application.

(4)Sub-paragraphs (1) to (3) above shall apply for the purposes of any provision made by or under this Schedule for any matter to be notified to the Commissioners as they apply for the purposes of any provision so made for an application to be made to them; and for this purpose references to the making of the application shall be construed as references to the giving of the notification.

Interpretation of Schedule

8(1)For the purposes of this Schedule two or more bodies are under the same control if—

(a)one of them controls each of the others;

(b)one person (whether a body corporate or an individual) controls all of them; or

(c)two or more individuals carrying on a business in partnership control all of them.

(2)For the purposes of this Schedule a body corporate shall be taken to control another body corporate if, and only if—

(a)it is empowered by statute to control that body’s activities; or

(b)it is that body’s holding company within the meaning of section 736 of the Companies Act 1985 (c. 6).

(3)For the purposes of this Schedule an individual or individuals shall be taken to control a body corporate if, and only if (were he or they a company) he or they would be that body’s holding company within the meaning of section 736 of the Companies Act 1985.

(4)In this Schedule “the specified time”, in relation to an application made under paragraph 2(1) or (2) or 3(1) above, means the beginning of such accounting period as may be specified in the application.

Section 46.

SCHEDULE 10Aggregates levy: assessment of civil penalties and interest on them

Preliminary

1(1)In this Schedule “civil penalty” means any penalty liability to which—

(a)is imposed by or under this Part of this Act; and

(b)arises otherwise than in consequence of a person’s conviction for a criminal offence.

(2)In this Schedule—

(a)references to a person’s being liable to a civil penalty include references to his being a person from whom the whole or any part of a civil penalty is recoverable by virtue of paragraph 8 of Schedule 6 to this Act; and

(b)references, in relation to a person from whom the whole or any part of a civil penalty is so recoverable, to the penalty to which he is liable are references to so much of the penalty as is recoverable from him.

(3)Any notification of an assessment under any provision of this Schedule to a person’s representative shall be treated for the purposes of this Part of this Act as notification to the person in relation to whom the representative acts.

(4)In this paragraph “representative”, in relation to any person, means—

(a)any of that person’s personal representatives;

(b)that person’s trustee in bankruptcy or liquidator;

(c)any person holding office as a receiver in relation to that person or any of his property;

(d)that person’s tax representative or any other person for the time being acting in a representative capacity in relation to that person.

(5)In this paragraph “trustee in bankruptcy” includes, as respects Scotland—

(a)an interim or permanent trustee (within the meaning of the Bankruptcy (Scotland) Act 1985 (c. 66)); and

(b)a trustee acting under a trust deed (within the meaning of that Act).

Assessments to penalties etc.

2(1)Where a person is liable to a civil penalty, the Commissioners may assess the amount due by way of penalty and notify it to him accordingly.

(2)If, where an assessment has been notified to any person under sub-paragraph (1) above or this sub-paragraph, it appears to the Commissioners that the amount which ought to have been assessed exceeds the amount that has already been assessed, the Commissioners may make a supplementary assessment of the amount of the excess and notify that person accordingly.

(3)The fact that any conduct giving rise to a civil penalty may have ceased before an assessment is made under this paragraph shall not affect the power of the Commissioners to make such an assessment.

(4)Where an amount has been assessed and notified to any person under this paragraph, it shall be recoverable as if it were aggregates levy due from him.

(5)Sub-paragraph (4) above—

(a)shall not apply so as to require any interest to be payable on a penalty otherwise than in accordance with this Schedule; and

(b)shall not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.

(6)Subject to sub-paragraph (7) below, where a person—

(a)is assessed under this paragraph to an amount due by way of a penalty, and

(b)is also assessed under any one or more provisions of Schedule 5 to this Act for an accounting period to which the conduct attracting the penalty is referable,

the assessments may be combined and notified to him as one assessment.

(7)A notice of a combined assessment under sub-paragraph (6) above must separately identify the penalty being assessed.

(8)The power to make an assessment under this paragraph is subject to paragraph 8(4) of Schedule 6 to this Act.

Further assessments to daily penalties

3(1)This paragraph applies where an assessment is made under paragraph 2 above to an amount of a civil penalty to which any person is liable—

(a)under paragraph 1(3) of Schedule 7 to this Act (failure to provide information); or

(b)under paragraph 4(4) of that Schedule (failure to produce a document).

(2)The notice of assessment shall specify a time, not later than the end of the day of the giving of the notice of assessment, to which the amount of any daily penalty is calculated.

(3)For the purposes of sub-paragraph (2) above “daily penalty” means—

(a)in a case within sub-paragraph (1)(a) above, a penalty imposed by virtue of paragraph 1(3)(b) of Schedule 7 to this Act; and

(b)in a case within sub-paragraph (1)(b) above, a penalty imposed by virtue of paragraph 4(4)(b) of that Schedule.